SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
F O R M 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended July 31, 1998 Commission File No. 0-8862
----------------------------------------
First Hartford Corporation
--------------------------
(Exact name of registrant as
specified in its charter)
Maine 01-0185800
- ------------------------ -------------------
(State of Incorporation) (I.R.S. Employer
Identification No.)
149 Colonial Road, Manchester, Connecticut 06040
- ------------------------------------------ ----------
(Address of principal executive offices) (Zip Code)
(860) 646-6555
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
-------------------------------
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days.
YES |_| NO |X|
As of November 8, 1997, 3,089,985 shares of common stock of the Registrant
were outstanding.
<PAGE>
FIRST HARTFORD CORPORATION
INDEX
PART I. FINANCIAL INFORMATION PAGE
Item 1. Financial Statements
Consolidated Balance Sheets - July 31, 1998
and April 30, 1998 1 & 2
Consolidated Statements of Income (Loss)
Three Months Ended July 31, 1998 and
Three Months Ended July 31, 1997 3
Consolidated Statements of Cash Flows Three
Months Ended July 31, 1998 and Three Months
Ended July, 31, 1997 4 & 5
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 6
PART II. OTHER INFORMATION
Signatures 7
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements:
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
Assets July 31, April 30,
1998 1998
-------- ---------
Real Estate and equipment:
Developed properties $ 6,282,480 $ 5,269,443
(Net of $299,857 and $499,802 write down
to Estimated Market Values)
Equipment and leasehold improvements 181,415 168,726
----------- -----------
$ 6,463,895 $ 5,438,169
Less accumulated depreciation and
amortization 930,249 938,132
----------- -----------
$ 5,533,646 $ 4,500,037
Properties under construction and
investment in undeveloped properties $ 3,880,619 $ 2,148,678
----------- -----------
$ 9,414,265 $ 6,648,715
Cash 34,814 4,118
Accounts receivable, less allowance
for doubtful accounts 208,393 144,115
Deposits, escrows, and prepaid and
deferred expenses 779,602 757,939
Due from related parties and affiliates, and
investment in affiliated partnership 945,012 622,476
----------- -----------
$11,382,086 $ 8,177,363
=========== ===========
1
<PAGE>
PART I - FINANCIAL INFORMATION
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
July 31, April 30,
1998 1998
-------- ---------
Liabilities:
Mortgages, notes payable and capital
lease obligations:
Construction loan payable $ 5,296,564 $ 1,575,925
Mortgages payable $ 4,024,486 $ 4,717,963
Notes Payable:
Other 4,203,844 3,853,842
----------- -----------
$13,524,894 $10,147,730
Accounts payable 2,084,393 2,281,671
Accrued Liabilities 821,839 870,832
Due to Related Parties and affiliated
partnerships 1,417,363 1,045,502
----------- -----------
$17,848,489 $14,345,735
Shareholders' equity (deficiency):
Common stock, $1 par; authorized
6,000,000 shares; issued 3,322,213 shares 3,322,213 3,322,213
Capital in excess of par 4,857,645 4,857,645
Deficit (12,578,137) (12,280,106)
----------- -----------
($ 4,398,279) ($ 4,100,248)
Less 232,228 shares of common stock
held in treasury, at cost 2,068,124 2,068,124
----------- -----------
($ 6,466,403) ($ 6,168,372)
----------- -----------
$11,382,086 $ 8,177,363
=========== ===========
2
<PAGE>
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited)
Three Months Ended
------------------
July 31, 1998 July 31, 1997
------------- -------------
Revenues, Including Related
Party Respectively:
Sale of Real Estate $ 186,500 $ 1,509,700
Construction 63,948 52,007
Rental 248,977 702,372
Other 60,689 15,146
Non-Recurring Gain
Other -- 430,000
------------ ------------
$ 560,114 $ 2,709,225
Costs and Expenses:
Cost of Sales Real Estate 186,082 1,488,013
Construction 45,589 34,944
Operating, selling, general
and administrative 398,243 387,314
Interest 144,188 375,540
Depreciation and amortization 44,964 140,209
Real estate taxes 39,080 78,487
------------ ------------
$ 858,146 $ 2,504,507
------------ ------------
Net Income Gain (Loss) (298,032) $ 204,718
============ ============
Income Per Share ($ 0.10) $ 0.07
============ ============
Weighted Average Number of Common
Shares Outstanding 3,089,985 3,089,985
============ ============
3
<PAGE>
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
JULY 31, 1998
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
Cash flows from operating 3 months ended 3 months ended
activities: July 31, 1998 July 31, 1997
------------- -------------
Net Profit (Loss) ($ 298,031) $ 204,718
Adjustments to reconcile net loss
to net cash used in operating activities:
Depreciation 43,846 139,091
Amortization 1,118 1,118
Changes in assets and liabilities:
Increase in:
Accounts and Notes Receivable (64,278) (41,959)
Deposits, escrows, prepaid and
deferred expenses (22,781) (54,716)
Accrued liabilities (48,993) (38,975)
Decrease in:
Accounts payable (197,278) (531,423)
----------- -----------
Net cash used in operating activities ($ 586,397) ($ 322,146)
----------- -----------
Cash flows from investing activities:
Purchase of Equipment and
Leasehold Improvements (12,689) (16,309)
Proceeds from Sale of Real Estate 170,969 1,415,852
Payments for:
Additions to Properties under
construction (2,967,676) (311,354)
----------- -----------
Net Cash used in investing activities ($2,809,396) $ 1,088,189
----------- -----------
4
<PAGE>
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS, CONTINUED
JULY 31, 1998
Cash flows from financing 3 months ended 3 months ended
activities: July 31, 1998 July 31, 1997
------------- -------------
Proceeds from:
Construction Loans $ 5,370,639 $ --
Principal payments on:
Construction Loans Payable ($ 1,650,000)
Mortgages payable (193,475) ($ 44,264)
Notes payable (150,000) (742,567)
Repayment to related parties and
affiliated partnerships 49,325 178,746
----------- ----------
Net Cash provided by financing
activities $ 3,426,489 ($ 608,085)
----------
Net increase (decrease) in cash
and cash equivalents $ 30,696 $ 157,958
Cash and cash equivalents, beginning
of year 4,118 216,148
----------- ----------
Cash and cash equivalents,
end of year $ 34,814 $ 374,106
=========== ==========
5
<PAGE>
Item 2. FIRST HARTFORD CORPORATION AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The Registrant has used the following discussion in its 10K for the year
ended April 30, 1998. We believe the outlook to be the same.
In the past four (4) years, the Registrant has pursued an aggressive path
to end litigation and pay down its debt. Management believes both of those
objectives were met, as there is no material litigation currently on the horizon
and debt has been reduced by more than $35,000,000.00. To achieve this result,
virtually all of our partnership interests and most of our developed properties
had been sold. We are currently on a path to attempt to rebuild our asset base.
Shopping centers are under construction in Putnam, Connecticut and Mount Olive,
New Jersey. Other properties are held under option which hopefully will result
in additional developments.
In the fiscal year April 30, 1999, management does not foresee any
opportunities to sell any additional properties. With rental and management
income greatly reduced from previous year levels, the Registrant believes
operating losses will occur for the foreseeable future.
6
<PAGE>
PART II - OTHER INFORMATION
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.
FIRST HARTFORD CORPORATION
/s/ Stuart Greenwald
------------------------------------
Stuart Greenwald
Treasurer
Chief Financial Officer
(Duly Authorized Officer, Principal
Financial and Accounting Officer)
Date: 9/23/98
------------------------
7
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from 10-Q and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> APR-30-1999
<PERIOD-START> MAY-01-1998
<PERIOD-END> JUL-31-1998
<CASH> 34,814
<SECURITIES> 0
<RECEIVABLES> 260,593
<ALLOWANCES> 52,200
<INVENTORY> 3,880,619
<CURRENT-ASSETS> 243,207
<PP&E> 6,463,895
<DEPRECIATION> 930,249
<TOTAL-ASSETS> 11,382,086
<CURRENT-LIABILITIES> 2,906,232
<BONDS> 13,524,894
0
0
<COMMON> 1,254,089
<OTHER-SE> (7,720,492)
<TOTAL-LIABILITY-AND-EQUITY> 11,382,086
<SALES> 186,500
<TOTAL-REVENUES> 560,114
<CGS> 186,082
<TOTAL-COSTS> 79,128
<OTHER-EXPENSES> 448,748
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 144,188
<INCOME-PRETAX> (298,032)
<INCOME-TAX> 0
<INCOME-CONTINUING> (298,032)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (298,032)
<EPS-PRIMARY> (.10)
<EPS-DILUTED> (.10)
</TABLE>
