GREAT NECK, NY--(Marketwire - December 13, 2010) - BRT REALTY TRUST (
For the year ended September 30, 2010, BRT reported total revenues of $8.14 million and a net loss of $8.02 million, or a net loss of $.58 per share. For the year ended September 30, 2009, BRT reported total revenues of $12.15 million and a net loss of $47.76 million, or a net loss of $4.10 per share. The weighted average number of common shares outstanding for the year ended September 30, 2010 and 2009 is 13,871,668 and 11,643, 972, respectively.
Commenting on the operations, Jeffrey A. Gould, President and Chief Executive Officer, stated that the economic recession and the disruptions in real estate and credit markets over the past two fiscal years materially and adversely affected our business and our operating results. On the revenue side, he noted, "We were adversely affected primarily by a significant decrease in the average balance of performing loans outstanding caused by an increase in non-performing loans. On the expense side operating results were adversely affected primarily by loan loss provisions, impairment charges and foreclosure related professional fees."
Further commenting on operations, Mr. Gould stated as follows: "In the latter part of our 2010 fiscal year and first two months of our 2011 fiscal year, we have experienced a more positive lending environment. Comparing the immediately preceding quarter ending June 30, 2010 to the quarter ending September 30, 2010, the progress we have made in resolving our problems and refocusing on our primary lending business is apparent. As compared to the preceding quarter, the current quarter reflects an increase in interest income, loan fee income and operating income from real estate owned, with no additional loan loss provisions or impairment charges, although our foreclosure related professional fees increased as we actively litigate in bankruptcy court against the borrower of one defaulted loan. Our net loss decreased from the June 30, 2010 quarter to the September 30, 2010 quarter by $1.8 million to $1.17 million. In addition in the first two months of the 2011 fiscal year, we originated a total of $24.5 million of mortgage loans as compared to $4.2 million and $2.6 million originated in the last two quarters of fiscal 2010. "Our immediate challenge, Mr. Gould noted, is to originate more quality loans and complete the court proceedings related to three outstanding non-performing loans, which aggregate of $35.1 million.
Specifically commenting on the results of operations for the three months and year end September 30, 2010, Mr. Gould pointed out the following:
Three Month Ended September 30, 2010 Compared to Three Month Ended September 30, 2009.
-- Total revenues decreased by $1 million, or 36%, quarter-over-quarter
primarily due to a $30.3 million decline in the average balance of
outstanding performing loans and a decline in the outstanding balance
of purchase mortgages due to payoffs. Offsetting this decrease is a
$177,000 increase in operating income on real estate owned, primarily
the result of increased rental revenues derived from our Newark
properties.
-- Total expenses decreased by $454,000, or 12%, quarter-over-quarter
reflecting decreases in interest on borrowed funds, the advisor's fee,
loan loss provisions, general and administrative expenses and operating
expenses relating to real estate owned. The quarter, however, reflects
a $146,000 increase in foreclosure related professional fees due to a
litigation involving a bankruptcy filing by one of our borrowers.
-- Discontinued operations, which represents the operations, impairment
charges and gains on the sale of assets held for sale, decreased from a
loss of $2,736,000 in the three months ended September 30, 2009 to
income of $13,000 in the three months ending September 30, 2010. The
loss in the three months ended September 30, 2009 is primarily
attributable to impairment charges of $4,213,000 and a loss from
operations of $435,000, offset by a gain on sale of real estate assets
of $1,912,000.
Year Ended September 30, 2010 Compared to the Year Ended September 30, 2009.
-- Revenues declined $4,019,000, or 33%, primarily the result of a decline
of $57.6 million in the average balance of performing loans
outstanding. Offsetting this decline was an increase of $1.7 million
in rental revenues from real estate properties, primarily from our
Newark properties, and a $365,000 recovery on previously provided loan
loss allowances.
-- Total expenses declined by $16.5 million, or 45%, due primarily to a
$13.9 million decrease in loan loss provisions. The Trust also
benefited from declines in interest expense, the advisor's fee,
foreclosure related professional fees and general and administrative
expenses. The year ending September 30, 2009 included an expense of
$685,000 for fees related to restructuring our outstanding junior
subordinated notes. Partially offsetting these expense declines
year-over-year was an increase in impairment charges resulting
primarily from an additional reserve taken against an undeveloped
parcel owned by the Trust.
-- Discontinued operations, which represents the operations, impairment
charges and gains on sale of assets held for sale, increased from a
loss of $29.1 million in the year ended September 30, 2009 to income of
$590,000 in the year ended September 30, 2010. The change is primarily
attributable to the inclusion in the year ending September 30, 2009 of
impairment charges of $29.8 million and a loss from operations of $1.5
million, offset by a net gain on asset sales of $2.2 million. For the
year ended September 30, 2010, the Trust reported impairment charges of
$745,000 and a loss from operations of $602,000, offset by a gain of
$1.9 million from the sale of real estate assets.
In conclusion, Mr. Gould commented that "although in the current economic environment there are no assurances that our business will continue the recent positive trend, we are somewhat optimistic based upon the current level of interest in our short-term lending product."
BRT REALTY TRUST is a mortgage-oriented real estate investment Trust.
Certain information contained herein is forward looking within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements relating to a more positive lending environment and the recent positive trend in, and optimism concerning, BRT's business. BRT intends such forward looking statements to be covered by the safe harbor provisions for forward looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words "may," "will," "believe," "expect," "intend," "anticipate," "estimate," "project," or similar expressions or variations thereof. Forward looking statements, including our reengagement in originating senior short-term loans and our activity in lending in the New Year, involve known and unknown risks, uncertainties and other factors, which, in some cases, are beyond BRT's control and could materially affect actual results, performance or achievements. Investors are cautioned not to place undue reliance on any forward-looking statements.
BRT REALTY TRUST
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share data)
(Unaudited) (Audited)
Three Months Ended Twelve Months Ended
September 30, September 30,
2010 2009 2010 2009
---------- ---------- ---------- ----------
Interest and fees on loans $ 933 $ 2,070 $ 3,877 $ 9,710
Rental revenue from real
estate properties 812 635 3,422 1,718
Other revenues 137 189 836 726
---------- ---------- ---------- ----------
Total revenues 1,882 2,894 8,135 12,154
Interest - borrowed funds 201 710 1,773 4,435
Provision for loan loss - (420) 3,165 17,110
Impairment Charges - - 2,625 1,272
General and administrative
expenses 1,482 1,712 6,063 7,045
Operating expenses on real
estate properties 804 997 3,866 2,361
Other expenses 783 725 2,352 4,106
---------- ---------- ---------- ----------
Total expenses 3,270 3,724 19,844 36,329
---------- ---------- ---------- ----------
Total revenues less total
expenses (1,388) (830) (11,709) (24,175)
Equity in earnings (loss)
of unconsolidated ventures 53 (808) 196 (2,791)
Gain on sale of joint
venture interests - - - 271
Gain on sale of
available-for-sale
securities - 924 1,586 1,016
Gain on early
extinguishment of debt - 6,443 - 6,443
---------- ---------- ---------- ----------
Loss from continuing
operations (1,335) 5,729 (9,927) (19,236)
Discontinued operations:
Loss from operations (7) (435) (602) (1,549)
Impairment Charges - (4,213) (745) (29,774)
Gain on sale of real
estate assets 20 1,912 1,937 2,199
---------- ---------- ---------- ----------
Income (loss) from
discontinued operations 13 (2,736) 590 (29,124)
---------- ---------- ---------- ----------
Net loss (1,322) 2,993 (9,337) (48,360)
Less: net loss attributable
to noncontrolling interest 156 474 1,322 605
---------- ---------- ---------- ----------
Net loss attributable to
common shareholders $ (1,166) $ 3,467 $ (8,015) $ (47,755)
========== ========== ========== ==========
Basic and diluted per share
amounts attributable to
common shareholders:
Loss from continuing
operations $ (0.08) $ 0.54 $ (0.62) $ (1.60)
Income (loss) from
discontinued operations 0.00 (0.24) 0.04 (2.50)
---------- ---------- ---------- ----------
Basic and diluted loss
per share $ (0.08) $ 0.30 $ (0.58) $ (4.10)
========== ========== ========== ==========
Amounts attributable to BRT
Realty Trust
Loss from continuing
operations $ (1,179) $ 6,203 $ (8,605) $ (18,631)
Income (loss) from
discontinued operations 13 (2,736) 590 (29,124)
---------- ---------- ---------- ----------
Net loss $ (1,166) $ 3,467 $ (8,015) $ (47,755)
========== ========== ========== ==========
Cash distribution per share $ - $ 0.12 $ - $ 0.12
Stock distribution per share - 1.03 - 1.03
---------- ---------- ---------- ----------
Total distribution per
common share $ - $ 1.15 $ - $ 1.15
========== ========== ========== ==========
Weighted average number of
common shares outstanding:
Basic and diluted 14,082,236 11,575,475 13,871,668 11,643,972
========== ========== ========== ==========
Contact Information: Contact: Simeon Brinberg (516) 466-3100