DALLAS, Nov. 14, 2002 (PRIMEZONE) -- Income Opportunity Realty Investors, Inc. (AMEX:IOT) Thursday reported a net loss of $1.24 million, or ($.86) per share, on revenue of $2.81 million for the third quarter ending September 30, 2002, as compared to a net loss of $1.75 million, or ($1.16) per share, on revenue of $2.47 million for third quarter 2001, due to decreased occupancy rates at the commercial properties offsetting increased rents and occupancy at the apartments. No gains on the sale of real estate were recorded in the third quarter of 2002 or 2001.
In the nine months ended September 30, 2002, a $7.11 million gain on the sale of an office building contributed to net income of $2.95 million, or $2.04 per share, on revenue of $8.10 million, as compared to a net loss of $3.20 million, or ($2.11) per share, on revenue of $7.79 million for the comparable 2001 period, which recorded no gain on the sale of real estate.
Income in the 2002 third quarter and nine months, compared to the same periods in 2001, included:
-- Increased rental income of $2.56 million in the three months and decreased rents of $7.47 million in the nine months, compared to $2.49 million and $7.68 million in 2001, due to lower occupancy at the commercial properties. Commercial property occupancy rates fell 11 percent between nine months 2002 and 2001.
-- Increased interest income of $185,000 and $533,000, compared to $8,000 and $142,000 in 2001, due to funding two loans in 2002.
Expenses in the third quarter of 2002 decreased to $3.97 million from $4.31 million in 2001, and increased in the nine months of 2002 to $11.83 million, from $11.14 million in 2001. Total expenses included:
-- Decreased property expense of $1.61 million and $4.15 million, compared to $1.99 million and $4.47 million in 2001, due to decreased taxes on land.
-- Decreased interest expense of $1.10 million and $3.36 million, compared to $1.30 million and $3.87 million in 2002, due to a loan refinancing in 2001 and lower interest rates.
-- A provision for loss of $767,000 on a note receivable recorded in the nine months. No such provision was reported in the 2001 period.
-- A provision for asset impairment of $336,000 recorded in the three months on a second office building sold during the quarter. No such provision was reported in the 2001 period.
-- A net income fee to affiliate of $411,000 was paid to the advisor in the nine months. No such fee was paid in the nine months of 2001. The fee is based on 7.5 percent of net income.
Income Opportunity Realty Investors, Inc. is a Dallas-based real estate investment trust. IORI invests in equity interests in real estate through direct ownership and partnerships. For more information, go to the website at www.incomeopp-realty.com.
FINANCIAL HIGHLIGHTS
(dollars in thousands, except share and per share data)
Three months ended Nine months ended
September 30, September 30,
2002 2001 2002 2001
-------- -------- -------- -------
Income from rents $ 2,562 $ 2,488 $ 7,473 $ 7,679
Expense from operations 1,610 1,993 4,152 4,470
-------- -------- -------- -------
Operating income 952 495 3,321 3,209
Other income 245 (22) 624 115
Other expense 2,356 2,319 7,681 6,669
-------- -------- -------- -------
Net loss from continuing
operations (1,159) (1,846) (3,736) (3,345)
Net income (loss) from
discontinued operations (82) 97 (424) 147
Gain on sale of
real estate -- -- 7,105 --
-------- -------- -------- -------
(82) 97 6,681 147
Net income (loss) $ (1.241) $ (1,749) $ 2,945 $(3,198)
Earnings (Loss) Per Share
Net loss from continuing
operations $ (.80) $ (1.22) $ (2.60) $ (2.21)
Discontinued operations (.06) .06 4.64 .10
Net income (loss) $ (.86) $ (1.16) $ 2.04 $ (2.11)
-------- -------- -------- -------
Weighted average common
shares used to
compute earnings
per share 1,438,945 1,508,331 1,438,945 1,512,119