Form 10-QSB
U.S. Securities and Exchange Commission
Washington, D.C. 20549
(Mark One)
[XX]QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended December 31, 1996
[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from to
Commission File Number: 0-7775
WESTLAND DEVELOPMENT CO., INC.
------------------------------
(Exact name of small business issuer as
specified in its charter)
NEW MEXICO 85-0165021
- --------------------------------- -------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
401 Coors Blvd., N.W.,
Albuquerque, New Mexico 87121
- -------------------------------------------------------------------------------
(Address of principal executive offices)
(505)831-9600
- -------------------------------------------------------------------------------
(Issuer's telephone number)
N/A
- -------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
YES [ X ] No [ ]
State the number of shares outstanding of each of the issuer's classes of
common equity as of February 13, 1997:
No Par Value Common: 716,608
Class A $1.00 Par Value Common: NONE
Class B $1.00 Par Value Common: 86,100
Transitional Small Business Format (check one) Yes [ ] No [ X ]
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
WESTLAND DEVELOPMENT CO., INC.
BALANCE SHEET
(unaudited)
December 31, 1996
ASSETS
Cash and cash equivalents .......................... $ 916,842
Receivables:
Real estate contracts ........................... $ 99,506
Less related deferred profit ............... 74,444
-----------
25,062
Note receivable - related party ................. 69,116
Other receivables ............................... 103,128
Accrued interest ................................ 903 198,209
-----------
Land and improvements held for
future development .............................. 5,328,006
Income producing properties, net ................... 7,201,466
Property and equipment, net of accumulated
depreciation of $375,301 ........................ 397,880
Investment in Partnerships and joint ventures ...... 518,909
Other .............................................. 505,816
-----------
$15,067,128
===========
LIABILITIES AND STOCKHOLDER'S EQUITY
Accounts payable, accrued expenses
and other liabilities ........................... $ 233,793
Accrued interest payable ........................... 44,229
Deferred income taxes .............................. 3,233,000
Notes, bonds, mortgages and assessments payable .... 6,888,896
-----------
Total liabilities ................. 10,399,918
Stockholders' equity
Common stock - no par value;
authorized, 736,668 shares;
issued and outstanding,
716,608 shares ............................... 8,500
Class A common stock - $1.00 par
value; authorized, 736,668
shares; issued, none ......................... --
Class B common stock - $1.00 par
value; authorized, 491,112
shares; issued and outstanding,
86,100 shares ................................ 86,100
Additional paid-in capital ...................... 581,527
Retained earnings ............................... 3,991,083 4,667,210
----------- -----------
$15,067,128
===========
WESTLAND DEVELOPMENT CO., INC.
STATEMENTS OF OPERATIONS
(unaudited)
For the 3 months ended
December 31,
1996 1995
----------- -----------
Revenues
Land ...................................... $ 940,253 $ 509,578
Deferred profit recognized
on installment sales .................... 15,212 11,809
Rentals ................................... 175,676 111,195
----------- -----------
1,131,141 632,582
Costs and expenses
Cost of land revenues ..................... 200,991 195,138
Cost of rentals ........................... 30,675 32,986
Other general and administrative .......... 454,121 524,357
Legal ..................................... 2,315 9,921
----------- -----------
688,102 762,402
----------- -----------
Operating income (loss) ................ 443,039 (129,820)
Other (income) expense
Interest income ........................... (23,013) (24,211)
Gain on sale of property and
equipment ............................ (140) (50)
Other income .............................. -- (18,713)
Interest expense .......................... 180,411 105,992
Equity in losses of partnerships .......... 209 1,648
----------- -----------
157,467 64,666
----------- -----------
Earnings (loss) before income taxes .... 285,572 (194,486)
Income tax expense (benefit) ................. 114,344 (28,700)
----------- -----------
NET EARNINGS(LOSS) ..................... $ 171,228 $ (165,786)
=========== ===========
Weighted average common and
common equivalent shares
outstanding ............................... 802,708 794,393
=========== ===========
Net earnings (loss) per common and
common equivalent share ................... $ .21 $ (.21)
=========== ===========
WESTLAND DEVELOPMENT CO., INC.
STATEMENTS OF OPERATIONS
(unaudited)
For the 6 months ended
December 31,
1996 1995
----------- -----------
Revenues
Land .................................... $ 1,158,486 $ 1,297,900
Deferred profit recognized
on installment sales .................. 22,123 18,860
Rentals ................................. 269,431 182,256
----------- -----------
1,450,040 1,499,016
Costs and expenses
Cost of land revenues ................... 303,684 490,198
Cost of rentals ......................... 50,151 66,519
Other general and administrative ........ 970,702 938,248
Legal ................................... 3,133 47,194
----------- -----------
1,327,670 1,542,159
----------- -----------
Operating income (loss) .............. 122,370 (43,143)
Other (income) expense
Interest income ......................... (51,142) (68,220)
Gain on sale of property and
equipment .......................... (1,752) (150)
Other income ............................ -- (33,325)
Interest expense ........................ 290,856 180,649
Equity in losses of partnerships ........ 36,914 1,648
----------- -----------
274,876 80,602
----------- -----------
Loss before income taxes ............. (152,506) (123,745)
Income tax expense (benefit) ............... (60,887) --
----------- -----------
NET LOSS ............................. $ (91,619) $ (123,745)
=========== ===========
Weighted average common and
common equivalent shares
outstanding ............................. 801,689 790,643
=========== ===========
Net earnings (loss) per common and
common equivalent share ................. $ (.11) $ (.16)
=========== ===========
WESTLAND DEVELOPMENT CO., INC.
STATEMENTS OF CASH FLOWS
(unaudited)
For the six months ended
December 31,
1996 1995
------------- -------------
Cash flows from operating activities
Cash received from land sales
and collections on real
estate contracts receivable ............... $ 1,393,672 $ 1,931,595
Cash paid to develop real estate ............ (514,467) (433,976)
Cash received from rental operations ........ 265,250 213,850
Cash paid for rental operations ............. (3,918) (5,099)
Cash paid for property taxes
and maintenance .......................... (55,603) (92,115)
Interest received ........................... 75,208 57,246
Interest paid ............................... (305,307) (188,128)
Income taxes paid ........................... (261,999) (200,050)
Legal and other general and
administrative costs paid ................. (865,793) (1,186,458)
Other ....................................... 985 36,677
----------- -----------
Net cash provided (used) by
operating activities ...................... (271,972) 133,542
----------- -----------
Cash flows from investing activities
Capital expenditures for income
producing and other properties ............ (994,178) (440,297)
Proceeds from sale of assets ................ 1,873 150
----------- -----------
Net cash used by investing activities ...... (992,305) (440,147)
----------- -----------
Cash flows from financing activities
Borrowing on notes, mortgages and
assessments payable ...................... 1,473,785 646,200
Proceeds from sale of stock .................. 41,325 96,425
Repayments of bonds, mortgages,
notes and assessments payable ............. (1,021,607) (78,496)
Payment of dividends ......................... (480,125) (475,625)
----------- -----------
Net cash provided by (used)
in financing activities ................... 13,378 188,504
----------- -----------
NET INCREASE (DECREASE)IN CASH
AND CASH EQUIVALENTS ....................... (1,250,899) (118,101)
Cash and cash equivalents at
beginning of period ........................ 2,167,741 1,917,803
----------- -----------
Cash and cash equivalents at
end of period .............................. $ 916,842 $ 1,799,702
=========== ===========
Reconciliation of net earnings
(loss) to net cash used in
operating activities
Net loss ..................................... $ (91,619) $ (123,745)
Adjustments to reconcile net
earnings(loss)to net cash used in
operating activities
Depreciation ............................ 71,905 85,125
Collection on real estate
contracts receivable .................. 264,154 457,982
Profit recognized on prior
years' installment sales .............. (22,123) (18,860)
Gain on sale of assets .................. (1,752) (150)
Change in
Rents receivable, accrued interest,
property tax and other ................ (31,004) 163,827
Land and improvements held for
future development and income
producing properties .................. (211,585) 141,351
Other assets ............................ 92,849 (92,863)
Accounts and retainages payable,
accrued interest and other
liabilities .......................... (342,797) (479,125)
----------- -----------
Net cash provided (used) by
operating activities ....................... $ (271,972) $ 133,542
=========== ===========
WESTLAND DEVELOPMENT CO., INC.
NOTES TO THE FINANCIAL STATEMENTS
(unaudited)
December 31, 1996
1. The balance sheet at December 31, 1996, statements of cash flows for the
six months ended December 31, 1996 and 1995 and statements of operations for the
six and three month periods ended December 31, 1996 and 1995 have been prepared
by the Company, without audit. In the opinion of management, all adjustments,
including normal recurring adjustments necessary to present fairly the financial
position, results of operations and cash flows, have been made. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principals have been
condensed or omitted. It is suggested that these financial statements be read in
conjunction with the Company's audited financial statements at June 30, 1996.
The results of operations for the six months ended December 31, 1996 are not
necessarily indicative of operating results for the full year.
2. The computation of net earnings (loss) per common and common equivalent
share has been based on the weighted average number of shares of outstanding
common stock and common stock issuable without further consideration (referred
to as equivalents), which for the six and three month periods ended December 31,
1996 were 801,689 and 802,708, respectively and for the six and three month
periods ended December 31, 1995 were 790,643 and 794,393, respectively.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
During the six months ended December 31, 1996, the Company's cash and cash
equivalents decreased by $1,250,899. During this period, the Company received
$41,325 from the sale of stock, invested $992,305, net, in fixed and other
assets, retired $1,021,607 of debt, borrowed $1,473,785 and paid dividends in
the amount of $480,125. Operations used $271,992.
During the second quarter of the current fiscal year, the Company had
revenue of $1,131,141 compared to $632,582 for the same quarter in the prior
fiscal year. Operating expenses for the quarter were $688,102 compared to
$762,402 for the same period in 1995. Revenue for the six months ended December
31, 1996 was $1,450,040 compared to $1,499,016 in 1995 and operating expenses
were $1,327,670 in 1996 and $1,542,159 in 1995. In April 1995, the Company began
selling small improved residential lots in addition to the large tracts it had
sold in the past. These sales amounted to approximately $747,000 and added
$444,000 to the cost of sales in 1995, but increased sales and cost of sales by
$239,000 and $115,000, respectively, in 1996.
The Company may expend approximately $900,000 or more to acquire
replacement lands and property for the land sold to the National Park Service
under threat of condemnation. In the event the Company does not replace the
property sold to the National Park Service, it may need to utilize a substantial
portion of its liquid investments for federal and state income taxes.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Other than the ordinary routine litigation incidental to the Company's
business, neither the Company nor any member of management is the subject of any
pending or threatened legal proceeding.
ITEM 2. CHANGES IN SECURITIES
NONE
ITEM 3. DEFAULTS IN SENIOR SECURITIES
NONE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
NONE
ITEM 5. OTHER INFORMATION
NONE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) There are no exhibits required by Item 601 of Regulation S-K.
(b) Reports on Form 8-K. State whether any reports on Form 8-K have been
filed during the quarter for which this report is filed, listing the items
reported, any financial statements filed, and the dates of any such reports.
NONE
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
WESTLAND DEVELOPMENT CO., INC.
DATE: February 13, 1996 By: Barbara Page
---------------------------
Barbara Page, President,
Chief Executive Officer and
Chief Accounting Officer
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