Business & Finance
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Business and Finance
Thu, August 19, 2010
Wed, August 18, 2010
Tue, August 17, 2010 Vestin Realty Mortgage I, Inc. Reports Results for the Three and Six Months Ended June 30, 2010
LAS VEGAS--([ BUSINESS WIRE ])--Vestin Realty Mortgage I, Inc. (Nasdaq: VRTA), a real estate investment trust (aREITa), announced results of operations for the three and six months ended June 30, 2010.
The Company reported a net loss of approximately $0.6 million or ($0.10) per share and $0.9 million or ($0.14) per share, respectively, for the three and six months ended June 30, 2010 compared with a net loss of approximately $3.2 million or ($0.49) per share and $4.7 million or ($0.72) per share, respectively, for the three and six months ended June 30, 2009.
Interest income from investment in real estate loans was approximately $0.6 million for the six months ended June 30, 2010, as compared with approximately $0.8 million for the same period in 2009. This decrease in interest income is mainly due to the decrease in our portfolio of performing real estate loans, which declined from 14 loans totaling approximately $12.7 million as of June 30, 2009, to nine loans totaling approximately $8.1 million as of June 30, 2010. Our revenue is dependent upon the balance of our performing loans and the interest earned on these loans. In addition, the weighted average interest rate on our performing loans has decreased from 12.48% as of June 30, 2009 to 10.85% as of June 30, 2010. This decline is a result of current market conditions in the lending industry, the level of non-performing assets in our portfolio and the reduction of interest rates on outstanding loans through Troubled Debt Restructuring.
As of June 30, 2010, the Company had 17 real estate loans outstanding with a balance of approximately $26.3 million, of which eight loans with an aggregate principal amount approximating $18.2 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. As of June 30, 2010, the Company had commenced foreclosure proceedings with respect to most of the non-performing loans, of which three loans have subsequently been foreclosed upon, including the RightStar loans in Hawaii. In addition, the Company is conducting workout discussions with certain non-performing borrowers; however, no assurance can be given as to whether these discussions will be successful. As of June 30, 2010, we owned six properties that we acquired through foreclosure, compared with 11 properties owned as of December 31, 2009.
As of June 30, 2010, shareholder equity was $3.64 per common share. The Company had on its balance sheet approximately $4.4 million of cash, $16.0 million of investment in real estate loans, net of allowance of $10.3 million, $2.9 million in real estate held for sale and approximately $1.3 million in total liabilities as of June 30, 2010.
About Vestin Realty Mortgage I, Inc.
Vestin Realty Mortgage I, Inc. is a real estate investment trust (aREITa) that invests in commercial real estate loans. As of June 30, 2010, Vestin Realty Mortgage I, Inc. had assets of approximately $24.9 million. Vestin Realty Mortgage I, Inc. is managed by Vestin Mortgage, Inc., a significant majority owned 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.
Forward-Looking Statements
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 Companya™s potential inability to accurately forecast its operating results; the Companya™s potential inability to regain profitability or 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 Companya™s business. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.
FINANCIAL STATEMENTS | ||||||
| VESTIN REALTY MORTGAGE I, INC. | ||||||
| CONSOLIDATED BALANCE SHEETS | ||||||
| ASSETS | ||||||
| June 30, 2010 | December 31, 2009 | |||||
| (Unaudited) | ||||||
| Assets | ||||||
| Cash | $ | 4,395,000 | $ | 1,543,000 | ||
| Investment in marketable securities - related party | 304,000 | 486,000 | ||||
| Interest and other receivables, net of allowance of $21,000 at June 30, 2010 and $5,000 at December 31, 2009 | 1,041,000 | 546,000 | ||||
| Notes receivable, net of allowance of $696,000 at June 30, 2010 and $1,174,000 at December 31, 2009 | -- | -- | ||||
| Real estate held for sale | 2,877,000 | 3,879,000 | ||||
| Investment in real estate loans, net of allowance for loan losses of $10,296,000 at June 30, 2010 and $12,556,000 at December 31, 2009 | 16,041,000 | 19,746,000 | ||||
| Other assets | 234,000 | 75,000 | ||||
| Total assets | $ | 24,892,000 | $ | 26,275,000 | ||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||
| Liabilities | ||||||
| Accounts payable and accrued liabilities | $ | 1,057,000 | $ | 1,244,000 | ||
| Due to related parties | 90,000 | 280,000 | ||||
| Note payable | 146,000 | 22,000 | ||||
| Unearned revenue | 5,000 | -- | ||||
| Total liabilities | 1,298,000 | 1,546,000 | ||||
| Commitments and contingencies | ||||||
| Stockholders' equity | ||||||
| Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued | -- | -- | ||||
| Treasury stock, at cost, 385,882 shares at June 30, 2010 and 375,875 shares at December 31, 2009 | (863,000) | (850,000) | ||||
| Common stock, $0.0001 par value; 25,000,000 shares authorized; 6,875,066 shares issued and 6,489,184 outstanding at June 30, 2010 and 6,875,066 shares issued and 6,499,191 outstanding at December 31, 2009 | 1,000 | 1,000 | ||||
| Additional paid-in capital | 62,262,000 | 62,262,000 | ||||
| Accumulated deficit | (37,234,000) | (36,294,000) | ||||
| Accumulated other comprehensive loss | (572,000) | (390,000) | ||||
| Total stockholders' equity | 23,594,000 | 24,729,000 | ||||
| Total liabilities and stockholders' equity | $ | 24,892,000 | $ | 26,275,000 | ||
| VESTIN REALTY MORTGAGE I, INC. | ||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||
| (UNAUDITED) | ||||||||||||
For The | For The | |||||||||||
| 6/30/2010 | 6/30/2009 | 6/30/2010 | 6/30/2009 | |||||||||
| Revenues | ||||||||||||
| Interest income from investment in real estate loans | $ | 305,000 | $ | 419,000 | $ | 627,000 | $ | 766,000 | ||||
| Recovery of allowance for doubtful notes receivable | 10,000 | 10,000 | 10,000 | 10,000 | ||||||||
| Gain related to pay off of real estate loan, including recovery of allowance for loan loss | -- | 63,000 | -- | 63,000 | ||||||||
| Other income | 2,000 | 3,000 | 56,000 | 6,000 | ||||||||
| Total revenues | 317,000 | 495,000 | 693,000 | 845,000 | ||||||||
| Operating expenses | ||||||||||||
| Management fees - related party | 69,000 | 69,000 | 138,000 | 138,000 | ||||||||
| Provision for loan loss | 234,000 | 1,749,000 | 234,000 | 2,079,000 | ||||||||
| Interest expense | 2,000 | 6,000 | 2,000 | 6,000 | ||||||||
| Professional fees | 108,000 | 456,000 | 524,000 | 1,009,000 | ||||||||
| Professional fees - related party | 25,000 | 26,000 | 57,000 | 44,000 | ||||||||
| Loan fees | -- | 26,000 | -- | 26,000 | ||||||||
| Other | 130,000 | 101,000 | 253,000 | 219,000 | ||||||||
| Total operating expenses | 568,000 | 2,433,000 | 1,208,000 | 3,521,000 | ||||||||
| Loss from operations | (251,000) | (1,938,000) | (515,000) | (2,676,000) | ||||||||
| Non-operating income (loss) | ||||||||||||
| Interest income from banking institutions | -- | -- | -- | 1,000 | ||||||||
| Settlement expense | -- | -- | -- | (107,000) | ||||||||
| Total non-operating loss | -- | -- | -- | (106,000) | ||||||||
Income (loss) from real estate held for sale | ||||||||||||
| Revenue related to real estate held for sale | -- | 1,000 | -- | 11,000 | ||||||||
| Net gain (loss) on sale of real estate held for sale | 2,000 | (78,000) | 23,000 | (78,000) | ||||||||
| Expenses related to real estate held for sale | (48,000) | (54,000) | (102,000) | (92,000) | ||||||||
| Write-downs on real estate held for sale | (346,000) | (1,140,000) | (346,000) | (1,799,000) | ||||||||
| Total loss from real estate held for sale | (392,000) | (1,271,000) | (425,000) | (1,958,000) | ||||||||
| Loss before provision for income taxes | (643,000) | (3,209,000) | (940,000) | (4,740,000) | ||||||||
| Provision for income taxes | -- | -- | -- | -- | ||||||||
| NET LOSS | $ | (643,000) | $ | (3,209,000) | $ | (940,000) | $ | (4,740,000) | ||||
| Basic and diluted loss per weighted average common share | $ | (0.10) | $ | (0.49) | $ | (0.14) | $ | (0.72) | ||||
| Dividends declared per common share | $ | -- | $ | -- | $ | -- | $ | -- | ||||
| Weighted average common shares outstanding | 6,495,210 | 6,592,953 | 6,497,189 | 6,598,270 | ||||||||
