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 Jan. 31, 2000 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 -
Jan. 31, 2000 and April 30, 1999 1 & 2
Consolidated Statements of Income (Loss)
Nine Months Ended Jan. 31, 2000 and
Nine Months Ended Jan. 31, 1999 3
Consolidated Statements of Cash Flows
Nine Months Ended Jan. 31, 2000 and
Nine Months Ended Jan. 31, 1999 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)
Jan. 31, April 30,
Assets 2000 1999
------ -------- ---------
Real Estate and equipment:
Developed properties $20,329,939 $ 7,379,545
Equipment and leasehold improvements 119,783 117,311
----------- -----------
$20,449,722 $ 7,496,856
Less accumulated depreciation and
amortization 1,190,896 941,535
----------- -----------
$19,258,826 $ 6,555,321
Properties under construction and
investment in undeveloped properties $ -0- $11,641,378
----------- -----------
$19,258,826 $18,196,699
Cash 11,878 106,017
Accounts receivable, less allowance
for doubtful accounts 83,211 69,953
Deposits, escrows, and prepaid and
deferred expenses 1,384,530 1,167,942
Due from related parties and affiliates, and
investment in affiliated partnership 1,935,920 1,729,140
Deferred Tax Assets 1,606,441 1,606,441
----------- -----------
$24,280,806 $22,876,192
=========== ===========
1
<PAGE>
PART I - FINANCIAL INFORMATION
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
Jan. 31, April 30,
2000 1999
-------- ---------
Liabilities:
Mortgages and notes payable
and capital lease obligations:
Construction loan payable $ 12,581,000 $ 10,161,257
Mortgages payable $ 7,675,677 $ 7,849,778
Notes Payable:
Other 5,501,159 3,818,659
------------ ------------
$ 25,757,836 $ 21,829,694
Accounts payable 1,755,237 3,101,020
Accrued Liabilities 555,776 639,001
Due to Related Parties and affiliated
partnerships 1,446,869 1,834,624
------------ ------------
$ 29,515,718 $ 27,404,339
Shareholders' equity (deficiency):
Common stock, $1 par; authorized
6,000,000 shares; issued 3,322,213
shares 3,322,213 3,322,213
Capital in excess of par 4,857,645 4,857,645
Deficit (11,346,646) (10,639,881)
------------ ------------
($ 3,166,788) ($ 2,460,023)
Less 232,228 shares of common stock
held in treasury, at cost 2,068,124 2,068,124
------------ ------------
($ 5,234,912) ($ 4,528,147)
------------ ------------
$ 24,280,806 $ 22,876,192
============ ============
2
<PAGE>
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
----------------- ------------------
January 31, 2000 January 31, 1999 January 31, 2000 January 31, 1999
---------------- ---------------- --------------- ----------------
<S> <C> <C> <C> <C>
REVENUES, INCLUDING RELATED
PARTY RESPECTIVELY:
Sale of Real Estate $ -0- $ 472,000 $ -0- $ 95,500
Construction 276,058 138,176 1,319 30,554
Rental 2,199,461 831,433 893,957 316,224
Other 402,861 549,700 187,256 87,022
----------- ----------- ----------- ---------
$ 2,878,380 $ 1,991,309 $ 1,082,532 $ 529,300
COSTS AND EXPENSES:
Cost of Sale of Real Estate $ -0- $ 464,005 $-0- $90,410
Construction 156,563 108,184 14,259 25,036
Operating, selling general
and administrative 1,529,125 1,329,157 602,604 495,528
Interest 1,371,005 470,487 482,807 186,114
Depreciation and amortization 266,667 147,343 119,432 50,109
Real Estate Taxes 261,785 88,324 85,776 25,251
----------- ----------- ----------- ---------
$ 3,585,145 2,607,500 $ 1,304,878 $ 872,448
NET INCOME (LOSS) BEFORE
INC. TAX ($ 706,765) ($616,191) ( 222,346) ($343,148)
Federal Income Tax -0- -0- -0- -0-
----------- ----------- ----------- ---------
NET INCOME (LOSS) AFTER
INC. TAX ($ 706,765) ($616,191) ($ 222,346) ($343,148)
=========== =========== =========== =========
INCOME (LOSS) PER SHARE ($ 0.23) ($ 0.20 ) ( $ .07 ) ( $0.11)
Weighted Average Number of
Common Shares Outstanding 3,089,985 3,089,985 3,089,985 3,089,985
=========== =========== =========== =========
</TABLE>
The accompanying notes are an integral part
of these financial statements.
3
<PAGE>
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
January 31, 1999
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
<TABLE>
<CAPTION>
Cash flows from operating 9 months ended 3 months ended
activities: 01/31/2000 01/31/99 01/31/2000 01/31/99
---------- -------- ---------- --------
<S> <C> <C> <C> <C>
Net Profit (Loss) ($706,765) ($616,190) ($222,346) ($343,147)
Adjustments to reconcile net loss
to net cash used in operating activities:
Depreciation 255,125 141,106 114,699 47,254
Amortization 11,542 6,237 4,733 2,855
Changes in assets and liabilities:
Increase (Decrease) in:
Accounts & Notes Receivable (13,258) 62,955 82,792 56,458
Deposits, escrows, prepaid and
deferred expenses (228,130) (259,541) 46,028 (163,764)
Accrued liabilities (83,225) (139,115) (203,043) (65,063)
Decrease in:
Acct's payable (1,345,783) 792,998 (313,357) 465,046
----------- ----------- -------- ----------
Net cash used in oper. activities (2,110,494) (11,550) (490,494) (361)
----------- ----------- -------- ----------
Cash flow from investing activities:
Proceed from Sale of Real Estate -0- 420,665 -0- 81,150
Purchase of equip & leasehold imp (8,420) (13,635) (1,730) (623)
Payments for:
Additions to properties
under construction (1,308,832) (9,113,177) (129,111) (3,487,138)
----------- ----------- -------- ----------
Net Cash used in investing
activities: ($1,317,252) ($8,706,147) (130,841) (3,406,611)
----------- ----------- -------- ----------
</TABLE>
The accompanying notes are an integral part
of these financial statements.
4
<PAGE>
FIRST HARTFORD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS, CONTINUED
JANUARY 31, 1999
INCREASE (DECREASE) IN CASH EQUIVALENTS
<TABLE>
<CAPTION>
Cash flows from operating 9 months ended 3 months ended
activities: 01/31/2000 01/31/1999 01/31/2000 01/31/1999
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Cash flows from operating activities:
Proceeds from:
Construction Loan 2,419,743 11,709,646 178,548 3,725,579
Mortgage Payable -- 3,725,000 -- 3,725,000
Notes Payable 1,782,500 -- 457,500 --
Principal payments on:
Construction Loan -- (5,375,000) -- (
3,725,000)
Mortgage Payable (174,099) (505,731) (76,978) (117,776)
Notes Payable (100,000) (935,184) (100,000) (700,000)
Adv. from Related Parties and
affiliated Parties (594,537) 194,615 130,324 563,890
---------- ---------- ---------- ----------
Net Cash Provided by Financing
Activities 3,333,607 8,813,346 589,394 3,471,693
---------- ---------- ---------- ----------
Net Increase (Decrease) in cash
& Cash Equivalents (94,139) 95,649 (31,941) 64,721
Cash & Cash Equivalents
Beginning of Year 106,017 4,118 35,046 35,046
---------- ---------- ---------- ----------
Cash & Cash Equivalents
End of Year $ 11,878 $ 99,767 $ 3,105 $ 99,767
========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part
of these financial statements.
5
<PAGE>
Item 2. FIRST HARTFORD CORPORATION AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Result of Operations
The quarter ended January 31, 2000 produced a loss of $222,000 or (.07)
per share compared to a profit of approximately $343,000 or (.11) per share for
the quarter ended January 31, 1999. For the nine month period, a loss of
$707,000 or (.23) per share compares to a loss of $616,000 or (.20) per share
for the period ended January 31, 1999.
For the three and nine month periods ending January 31, 2000, rental
income has increased to $894,000 and $2,199,000 from $316,000 and $831,000 from
the comparable period in 1999. New rentals have basically stabalized this
quarter.
The registrant is presently building a shopping center in Dover Township,
New Jersey as a Joint Venture in which the Registrant has 50% ownership. The
construction loan was closed in November, 1999. Substantial completion should be
mid summer 2000 with the Grand Union opened for business by May of 2000.
There are two additional projects that the Registrant is attempting to
develop. The registrant has advanced approximately $750,000 into these projects
to make option payments and to pay outside professionals. These advances are
included in the Balance Sheet as Due from related parties and affiliates and
investment in affiliated partnerships. Notes Payable have increased $1.8 million
over the nine month period partly from the above and partly from the reductions
in accounts payable.
Capital resource and liquidity have always been a major impediment of the
Registrant. Reputation, industry contacts and capital resources are the key
elements of the real estate development business. Management has continued to
explore new lenders and believes we will continue to find capital resources at
reasonable rates. Liquidity is worked on a daily basis through tight cash
management and the Registrant believes that will be adequate. In the event that
it is not, the Registrant will seek to bring a partner into one of the existing
properties or an outright sale.
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: 3/15/2000
---------
7
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> APR-30-2000
<PERIOD-START> MAY-01-1999
<PERIOD-END> JAN-31-2000
<CASH> 11,878
<SECURITIES> 0
<RECEIVABLES> 179,211
<ALLOWANCES> 96,000
<INVENTORY> 0
<CURRENT-ASSETS> 95,089
<PP&E> 20,449,722
<DEPRECIATION> 1,190,896
<TOTAL-ASSETS> 24,280,806
<CURRENT-LIABILITIES> 2,311,013
<BONDS> 25,757,836
0
0
<COMMON> 1,254,089
<OTHER-SE> (6,489,001)
<TOTAL-LIABILITY-AND-EQUITY> 24,280,806
<SALES> 0
<TOTAL-REVENUES> 2,878,380
<CGS> 0
<TOTAL-COSTS> 311,885
<OTHER-EXPENSES> 3,273,260
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,371,005
<INCOME-PRETAX> (706,765)
<INCOME-TAX> 0
<INCOME-CONTINUING> (706,765)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (706,765)
<EPS-BASIC> (.23)
<EPS-DILUTED> (.23)
</TABLE>
