Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
( )TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
For the transition period from _______________ to ______________
For the Quarter ended Commission File
March 31, 1996 No. 2-29442
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware 22-1897375
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
125 Wyckoff Road, Eatontown, New Jersey 07724
(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code:(908)542-4927
----------------------------------------------------------------
(Former name, former address and former fiscal year, if changed
since last report.)
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 and Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the Registrant was re-
quired to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No___
Indicate by check mark whether the financial statements required
by instruction H have been reviewed by an independent public ac-
countant. Yes ___ No X
The number of shares or other units outstanding of each of the
issuer's classes of securities as of March 31, 1996 was
3,584,878.
Page 1
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
FOR THE QUARTER ENDED MARCH 31, 1996
C O N T E N T S
Page No.
Part I - Financial Information
Item 1 - Financial Statements (Unaudited):
Balance Sheets 3
Statements of Income 4
Statements of Cash Flows 5
Notes to Financial Statements 6
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of
Operations 7-8
Part II- Other Information 9
Signatures 10
Page 2
<TABLE>
<CAPTION>
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
BALANCE SHEETS
AS OF MARCH 31, 1996 AND SEPTEMBER 30, 1995
3/31/96 9/30/95
<S> <C> <C>
ASSETS
Real Estate Investments:
Land $ 4,545,324 $ 4,545,324
Buildings, Improvements and
Equipment, Net of Accumulated
Depreciation of $4,049,720
and $3,657,061, respectively 23,578,535 23,966,469
Mortgage Loans Receivable 277,219 293,997
___________ ___________
Total Real Estate Investments 28,401,078 28,805,790
Cash and Cash Equivalents 394,651 144,019
Equity Securities Available for Sale at
Fair Value(Cost $104,335 and
$214,298 respectively) 123,550 273,038
Interest and Other Receivables 532,458 581,247
Prepaid Expenses 110,337 114,815
Lease Costs - Net of Accumulated
Amortization 46,748 59,742
Other Assets 312,582 311,209
___________ ___________
TOTAL ASSETS $29,921,404 $30,289,860
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Mortgage Notes Payable $14,200,169 $15,463,561
Deferred Gain - Installment Sale 196,238 208,238
Other Liabilities 463,886 370,194
___________ ___________
Total Liabilities 14,860,293 16,041,993
___________ ___________
Shareholders' Equity:
Common Stock-Class A-$.01 Par Value,
8,000,000 Shares Authorized,
3,584,878 and 3,392,045 Shares
Issued and Outstanding, respectively 35,849 33,920
Common Stock-Class B-$.01 Par Value,
100,000 Shares Authorized, No shares
Issued or Outstanding -0- -0-
Additional Paid-in Capital 15,250,883 14,155,207
Unrealized Holding Gain on
Equity Securities Available
for Sale 19,215 58,740
Undistributed Income (244,836) -0-
___________ ___________
Total Shareholders' Equity 15,061,111 14,247,867
___________ ___________
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $29,921,404 $30,289,860
=========== ===========
Unaudited
See Accompanying Notes to Financial Statements
Page 3
</TABLE>
<TABLE>
<CAPTION>
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
STATEMENTS OF INCOME
FOR THE THREE AND SIX MONTHS ENDED MARCH 31, 1996 AND 1995
3 Months 6 Months 3 Months 6 Months
Ended Ended Ended Ended
3/31/96 3/31/96 3/31/95 3/31/95
<S> <C> <C> <C> <C>
INCOME:
Rental and Occupancy
Charges $1,124,490 $2,179,104 $1,030,233 $2,107,433
Interest and Other Income 4,774 81,919 14,764 36,194
__________ __________ __________ __________
TOTAL INCOME 1,129,264 2,261,023 1,044,997 2,143,627
__________ __________ __________ __________
EXPENSES:
Interest Expense 299,576 615,960 350,475 700,913
Real Estate Taxes 111,013 158,697 28,609 86,882
Operating Expenses 117,356 198,868 85,191 165,881
General and Administrative
Expenses 140,260 278,525 144,107 263,677
Depreciation 196,329 392,658 187,715 363,593
_________ __________ __________ __________
TOTAL EXPENSES 864,534 1,644,708 796,097 1,580,946
_________ __________ __________ __________
INCOME BEFORE GAINS 264,730 616,315 248,900 562,681
Gain on Sales of Assets 6,000 12,000 4,800 9,600
_________ __________ __________ __________
NET INCOME $ 270,730 $ 628,315 $ 253,700 $ 572,281
========= ========== ========== ==========
PER SHARE INFORMATION
Weighted Average Shares
Outstanding 3,532,600 3,485,835 3,171,435 3,130,363
========= ========== ========= ==========
Net Income Per Share $ 0.08 $ 0.18 $ 0.08 $ 0.18
========= ========== ========= ==========
Unaudited
See Notes to Financial Statements
Page 4
</TABLE>
<TABLE>
<CAPTION>
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED MARCH 31, 1996 AND 1995
1996 1995
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 628,315 $ 572,281
Noncash Items Included in Net Income:
Depreciation 392,658 363,593
Amortization 56,658 60,741
Gain on Sale of Investments (78,933) (9,600)
Changes In:
Interest and Other Receivables 48,789 (68,811)
Prepaid Expenses 4,478 (39,685)
Other Assets and Lease Costs (45,037) 531,874
Other Liabilities 93,692 (51,098)
__________ ___________
NET CASH PROVIDED FROM OPERATING
ACTIVITIES 1,100,620 1,359,295
__________ ___________
CASH FLOWS FROM INVESTING ACTIVITIES
Collections on Installment Sales 16,778 13,983
Collections on Loans -0- -0-
Additions to Land, Buildings,
Improvements and Equipment (4,724) (3,657,872)
Purchase of Equity Securities
Available for Sale (37,754) -0-
Proceeds from Sale of Equity
Securities Available for Sale 214,650 -0-
__________ ___________
NET CASH PROVIDED OR (USED BY)
INVESTING ACTIVITIES 188,950 (3,643,889)
__________ ___________
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Mortgages -0- 2,500,000
Principal Payments of Mortgages (1,263,392) (1,515,119)
Proceeds from Issuance of Class A
Common Stock 717,390 400,942
Dividends Paid (492,936) (405,565)
___________ ___________
NET CASH PROVIDED FROM (USED BY)
FINANCING ACTIVITIES (1,038,938) 980,258
___________ ___________
Net Increase (Decrease)in Cash
and Cash Equivalents 250,632 (1,304,336)
Cash and Cash Equivalents at Beginning
of Period 144,019 1,454,240
___________ ___________
Cash and Cash Equivalents at End
of Period $ 394,651 $ 149,904
=========== ===========
Unaudited
See Accompanying Notes to Financial Statements
Page 5
</TABLE>
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - ACCOUNTING POLICY
The interim financial statements furnished herein reflect all adjust-
ments which were, in the opinion of management, necessary to present
fairly the financial position, results of operations and cash flows at
March 31, 1996 and for all periods presented. All adjustments made in
the interim period were of a normal recurring nature. Certain footnote
disclosures which would substantially duplicate the disclosures
contained in the audited financial statements and notes thereto
included in the Annual Report of Monmouth Real Estate Investment
Corporation (the Company) for the year ended September 30, 1995 have
been omitted. Certain amounts in the financial statements for the prior
period have been reclassified to conform to the statement presentation
for the current period.
NOTE 2 - EQUITY SECURITIES AVAILABLE FOR SALE
During the six month period ended March 31, 1996, a security held by
the Company was liquidated. The Company received $214,650 as a
liquidating dividend, resulting in a realized gain of $66,933. This
gain has been included in Other Income in the financial statements.
NOTE 3 - DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
On March 15, 1996, the Company paid $441,808 as a dividend of $.125 per
share to shareholders of record February 15, 1996. The total dividends
paid for the six months ended March 31, 1996 amounted to $873,151.
For the six months ended March 31, 1996, the Company received
$1,097,605 from the Dividend Reinvestment and Stock Purchase Plan
(DRIP). There were 192,833 new shares issued resulting in 3,584,878
shares outstanding.
NOTE 4 - SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid during the six months ended March 31, 1996 and 1995 for in-
terest is $615,960 and $700,913, respectively.
During the six months ended March 31, 1996 and 1995, the Company had
dividend reinvestments of $380,215 and $376,845, respectively, which
required no cash transfers.
Page 6
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
MATERIAL CHANGES IN FINANCIAL CONDITION
The Company generated net cash provided from operating activities of
$1,100,620 for the current six months as compared to $1,359,295 for the
prior period. The Company raised $1,097,605 from the issuance of
shares of common stock through a Dividend Reinvestment and Stock Pur-
chase Plan (DRIP). Current cash dividends paid amounted to $873,151.
Equity Securities Available for Sale decreased by $149,488 primarily as
the result of the liquidation of one of the Company's security
holdings.
Mortgage notes payable decreased by $1,263,392 during the six months
ended March 31, 1996. This decrease was a result of principal
repayments.
MATERIAL CHANGES IN RESULTS OF OPERATIONS
Rental and occupany charges increased for the quarter ended March 31,
1996 to $1,124,490 as compared to $1,030,233 for the quarter ended
March 31, 1995. Rental and occupancy charges increased for the six
months ended March 31, 1996 to $2,179,104 as compared to $2,107,433 for
the six months ended March 31, 1995. This is due primarily to an
acquisition made during fiscal 1995.
Interest and other income decreased by $9,990 for the three months
ended March 31, 1996 as compared to the three months ended March 31,
1995. Interest and other income increased by $45,725 for the six months
ended March 31, 1996 as compared to the six months ended March 31,
1995. This is primarily as a result of the gain on liquidation of
equity securities.
Interest expense decreased by $50,899 for the three months ended March
31, 1996 as compared to the three months ended March 31, 1995. Interest
expense decreased by $84,953 from $700,913 for the six months ended
March 31, 1995 to $615,960 for the six months ended March 31, 1996.
This was the result of principal repayments.
Operating expenses increased by $32,165 for the three months ended
March 31, 1996 as compared to the three months ended March 31, 1995.
Operating expenses increased from $165,881 for the six months ended
March 31, 1995 to $198,868 for the six months ended March 31, 1996.
This is primarily as a result of additional costs relating to this
year's harsh winter.
Depreciation expense increased by $8,614 and $29,065 for the three and
six month periods ended March 31, 1996, respectively, as compared to
the three and six month periods ended March 31, 1995, respectively, due
to the real estate acquisition in October, 1994.
Page 7
General and administrative expenses decreased by $3,847 and increased
by $14,848 for the three and six month periods ended March 31, 1996,
respectively as compared to the three and six month periods ended March
31, 1995, respectively, due primarily to an increase in professional
fees.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities decreased during the six
months ended March 31, 1996 to $1,100,620 as compared to $1,359,295
generated during the six months ended March 31, 1995. This was
primarily the result of the decrease in Other Assets during the six
months ended March 31, 1995. Other Assets at September 30, 1994
included deposits of $594,693 for the acquisition of a warehouse
facility. The acquisition was completed in October, 1994. The Company
has been raising capital through the DRIP and investing in net leased
industrial properties.
The Company owns thirteen properties of which nine carried mortgage
loans totaling $14,200,169 at March 31, 1996. The Company believes
that funds generated from operations, the Dividend Reinvestment and
Stock Purchase Plan, together with the ability to finance and refinance
its properties and net receivables will provide sufficient funds to ad-
equately meet its obligations over the next several years.
Page 8
PART II: OTHER INFORMATION
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
ITEM 1: LEGAL PROCEEDINGS - None
ITEM 2 CHANGES IN SECURITIES - None
ITEM 3: DEFAULTS UPON 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) EXHIBITS - None
(b) REPORTS ON FORM 8-K - None
Page 9
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.
MONMOUTH REAL ESTATE INVESTMENT CORPORATION
Date: May 3, 1996 By:/s/Eugene W. Landy
EUGENE W. LANDY, President
Date: May 3, 1996 By:/s/Anna T. Chew
ANNA T. CHEW, Controller
Page 10
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF MONMOUTH REAL ESTATE INVESTMENT CORPORATION AS OF
AND FOR THE SIX MONTHS ENDED MARCH 31, 1996 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> MAR-31-1996
<CASH> 394,651
<SECURITIES> 123,550
<RECEIVABLES> 532,458
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,160,996
<PP&E> 32,173,579
<DEPRECIATION> 4,049,720
<TOTAL-ASSETS> 29,921,404
<CURRENT-LIABILITIES> 463,886
<BONDS> 14,200,169
35,849
0
<COMMON> 0
<OTHER-SE> 15,025,262
<TOTAL-LIABILITY-AND-EQUITY> 29,921,404
<SALES> 0
<TOTAL-REVENUES> 2,273,023
<CGS> 0
<TOTAL-COSTS> 357,565
<OTHER-EXPENSES> 671,183
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 615,960
<INCOME-PRETAX> 628,315
<INCOME-TAX> 0
<INCOME-CONTINUING> 628,315
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 628,315
<EPS-PRIMARY> .18
<EPS-DILUTED> .18
</TABLE>
