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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended June 30, 1994, Commission File Number: 0-497
NEW MEXICO AND ARIZONA LAND COMPANY
(Exact name of registrant as specified in its charter)
Arizona 43-0433090
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2810 North Third Street, Suite 203, Phoenix, Arizona 85004
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 602/266-5455
Indicate by check mark whether the registrant (1) has filed all
reports to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding twelve 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 / /
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common Stock, no par value 2,479,853
Class Outstanding at June 30,1994
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New Mexico and Arizona Land Company and Subsidiaries FORM 10-Q
Page
Number
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated statements of operations for the three
and six months ended June 30, 1994 and 1993 3
Consolidated balance sheets as of
June 30, 1994 and December 31, 1993 4
Consolidated statements of cash flows for the
six months ended June 30,1994 and 1993 5
Notes to consolidated financial statements 6
Item 2. Management's discussion and analysis of
financial condition and results of operations 7
PART II - OTHER INFORMATION 8
SIGNATURES 8
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<TABLE>
New Mexico and Arizona Land Company and Subsidiaries FORM 10-Q
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<CAPTION>
Quarter ended Six months
June 30, ended June 30,
(In thousands, except per share data) 1994 1993 1994 1993
- - --------------------------------------------------------------------
Revenues:
<S> <C> <C> <C> <C>
Property Sales $2,987 $1,926 $5,131 $3,076
Property rentals 739 860 1,511 1,616
Investment income 277 207 717 429
Other 97 91 147 161
------ ------ ------ ------
4,100 3,084 7,506 5,282
------ ------ ------ ------
Expenses:
Cost of property sales 1,508 1,211 2,794 1,784
Rental property 308 301 591 602
General and administrative 738 287 1,100 581
Interest 282 423 558 839
Depreciation/depletion/amortization 131 160 269 301
Other 2 5 4 8
------ ------ ------ ------
2,969 2,387 5,316 4,115
------ ------ ------ ------
Income Before Joint Ventures, Minority
Interests and Income Taxes 1,131 697 2,190 1,167
Loss from joint ventures (192) (38) (188) (58)
Minority interests (260) (316) 0
------ ------ ------ ------
Income Before Income Taxes 679 659 1,686 1,109
Provision for income taxes 285 261 697 440
------ ------ ------ ------
NET INCOME $ 394 $ 398 $ 989 $ 669
====== ====== ====== ======
NET INCOME PER SHARE OF COMMON STOCK $ 0.16 $ 0.16 $ 0.40 $ 0.27
====== ====== ====== ======
AVERAGE NUMBER OF COMMON SHARES 2,480 2,481 2,480 2,481
====== ====== ====== ======
<FN>
See the accompanying Notes to Consolidated Financial Statements.
</FN>
</TABLE>
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<TABLE>
New Mexico and Arizona Land Company and Subsidiaries FORM 10-Q
CONSOLIDATED BALANCE SHEETS
<CAPTION>
Unaudited
June 30, December 31,
(Dollars in thousands) 1994 1993
- - ---------------------------------------------------------------------
ASSETS
<S> <C> <C>
Properties, net $36,119 $35,899
Receivables, net 9,435 8,842
Investments in joint ventures 475 666
Cash and cash equivalents 1,058 534
Other 1,070 681
------- -------
Total Assets $48,157 $46,622
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LIABILITIES AND SHAREHOLDERS EQUITY
Notes payable and lines of credit $16,180 $15,268
Accounts payable and accrued liabilities 1,074 1,306
Deferred revenue and commissions 5,122 5,566
Deferred income taxes 3,026 3,070
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Total liabilities 25,402 25,210
Minority Interests 592 259
Shareholders' Equity:
Common stock, no par value; 30,000,000
shares authorized; 2,490,679 shares
issued; 2,479,853 shares outstanding 7,812 7,812
Additional paid-in capital 911 891
Retained earnings 13,532 12,542
Treasury stock, at cost,10,826 shares (92) (92)
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Total shareholders' equity 22,163 21,153
------- -------
Total Liabilities and Shareholders Equity $48,157 $46,622
======= =======
<FN>
See the accompanying Notes to Consolidated Financial Statements.
</TABLE>
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<TABLE>
New Mexico and Arizona Land Company and Subsidiaries FORM 10-Q
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
Six Months ended June 30, 1994 1993
(Dollars in thousands) (Unaudited)
- - -------------------------------------------------------------------
Cash Flow from Operating Activities:
<S> <C> <C>
NET INCOME $989 $669
Non-cash items included above:
Depreciation/depletion/amortization 269 301
Deferred revenue (957) (365)
Deferred income taxes (44) (218)
Loss from joint ventures 188 58
Minority interests 316 0
Employee restricted stock plan 20 29
Net change in:
Receivables (680) 50
Land held for sale (362) (598)
Other assets (133) 192
Accounts payable and accrued liabilities (232) 202
------ ------
Net cash flow from operating activities (626) 320
Cash Flow From Investing Activities:
Additions to properties (129) (2,015)
Proceeds from sale of properties 2 57
Proceeds from notes receivable 601 596
Contribution to joint ventures 0 (18)
Distributions from joint ventures 3 43
------ ------
Net cash flow from investing activities 477 (1,337)
Cash Flow From Financing Activities:
Proceeds from debt 2,305 2,875
Payment of debt (1,649) (2,089)
Capital contribution from minority
interest partners 17 264
Purchase treasury shares 0 (51)
------ ------
Net cash flow from financing activities 673 999
------ ------
Net increase (decrease) in cash
and cash equivalents 524 (18)
------ ------
Cash and cash equivalents
at beginning of year 534 216
------ ------
Cash and cash equivalents at end of period $1,058 $ 198
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<FN>
See the accompanying Notes to Consolidated Financial Statements
</FN>
</TABLE>
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New Mexico and Arizona Land Company and Subsidiaries FORM 10-Q
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. In the opinion of the Company, the accompanying unaudited consolidated
financial statements contain all adjustments necessary to present fairly
the financial position, the results of operations and cash flows for the
periods presented. The accompanying statements do not include all
disclosures considered necessary for a fair presentation in conformity
with generally accepted accounting principles. Therefore, it statements
be read in conjunction with the notes to consolidated financial statements
appearing in the Company's 1993 annual report to shareholders.
2. The results of operations for the three and six months ended June 30,
1994 and 1993, are not necessarily indicative of the results to be
expected for the full year.
3. During the period ended June 30, 1994, the Company recorded an expense
of $398,000, which is the total amount due under an employment agreement
upon resignation of a certain officer. Mr. Richard E. Leonard resigned as
Chairman, President and Chief Executive officer on June 27, 1994.
The Company also recorded additional depletion for certain of its oil
and gas interests in the amount of $186,000, which is reflected in loss
from joint ventures.
4. During the six months ended June 30, 1994 and 1993, the Company
sold land in exchange for notes receivable in the amount of $601,000
and $510,000 respectively, all of which was deferred.
5. The Company s consolidated financial statements include those of its
wholly-owned subsidiaries, NZ Properties, Inc., NZ Development Corporation
and NZU Inc., along with three joint ventures in which the Company holds
a majority ownership.
6. Certain amounts have been reclassified for comparative purposes.
7. Earnings per share are based on 2,479,853 and 2,481,442 shares in 1994
and 1993 respectively, which represents the weighted average number of
shares outstanding.
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New Mexico and Arizona Land Company and Subsidiaries FORM 10-Q
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Cash flow from operations, along with unused borrowing capacity, should
be adequate for continuing operations and modest future investments.
Financing, at the joint venture level, is being utilized to develop
single-family lots. These loans are secured by the properties involved,
along with guarantees from the Company and its partner. On January 1,
1994 the Company s line of credit converted to a reducing revolving term
loan with a commitment base of $3,750,000. On April 26,1994 the commitment
base on this line reduced to $2,500,000 and on January 1, 1995 the base
will further reduce to $1,250,000. The loan, which matures June 30, 1995,
is secured by various real estate holdings and notes receivable. At June
30, 1994 the Company had $1,050,000 borrowed on this line.
RESULTS OF OPERATIONS
For the six months ended June 30, 1994 net income was $989,000 ($.40/per
share) compared to $669,000 ($.27/per share) for the same period of 1993.
During the six month period of 1994, the Company recorded two major
expense items, the liability in connection with the resignation of its
president and additional depletion of certain of its oil and gas interests.
(see Note 3 on page six) But, due to increased sales of single-family lots,
the recognition of interest income from a note receivable, and a decrease
in interest expense, earnings for the six month period of 1994 outpaced
those of the same period of 1993.
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New Mexico and Arizona Land Company and Subsidiaries FORM 10-Q
PART II - OTHER INFORMATION
There were no proceedings, changes, occurrences or other matters occurring
during the six month period ended June 30, 1994, requiring a response to
Items 1 through 5 of Regulation S-K.
6. Exhibits and Reports on Form 8-K
(A) Exhibits
None
(B) Form 8-K filed May 11, 1994
Item 1. Change in Control of Registrant
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.
New Mexico and Arizona Land Company
s/E.M.Bedewi
E. M. Bedewi,
Sr. Vice President and Treasurer
s/William A. Pope
William A. Pope,
President and Chief Executive Officer
Date: August 3, 1994
