SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM 10-QSB
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 1999
SANTA FE FINANCIAL CORPORATION
----------------------------
(Exact Name of Small Business Issuer as Specified in Its Charter)
Nevada 95-2452529
------------------------------- ------------------
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
11315 Rancho Bernardo Road, Suite 129
San Diego, California 92127-1463
--------------------------------------- ------------------
(Address of Principal Executive Offices) (Zip Code)
(619) 673-4722
---------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months, 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 the latest practicable date: 1,233,214 shares of issuer's
$.10 Par Value Common Stock were outstanding as of August 2, 1999.
Transitional Small Business Disclosure Format (check one): Yes ( ) No (X)
<PAGE> 2
INDEX
SANTA FE FINANCIAL CORPORATION
PART I FINANCIAL INFORMATION PAGE
Item 1. Financial Statements
Consolidated Balance Sheet--June 30, 1999 (Unaudited) 3
Consolidated Statement of Income and Comprehensive Income
(Unaudited)--Three Months ended June 30, 1999 and 1998 4
Consolidated Statement of Income and Comprehensive Income
(Unaudited)--Six Months ended June 30, 1999 and 1998 5
Consolidated Statement of Cash Flows (Unaudited)--
Six Months ended June 30, 1999 and 1998 6
Notes to Consolidated Financial Statements -June 30, 1999 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Securities Holders 12
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 13
<PAGE> 3
<TABLE>
<CAPTION>
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
Santa Fe Financial Corporation
Consolidated Balance Sheet
(Unaudited)
June 30,
1999
-------------
<S> <C>
Assets
Cash and cash equivalents $ 172,719
Restricted cash 46,902
Investment in marketable securities
Available for sale 15,431,366
Trading 3,458,650
Investment in Justice Investors 6,908,560
Rental property 1,812,049
Other investments 442,335
Notes receivable 101,579
Other assets 2,221,748
----------
Total assets $ 30,595,908
==========
Liabilities and Shareholders' Equity
Liabilities
Due to securities broker $ 6,032,390
Obligations for securities sold 4,788,811
Mortgage payable 1,217,315
Accounts payable and accrued expenses 1,792,399
----------
Total liabilities 13,830,915
----------
Minority interest 3,922,581
----------
Commitments and contingencies
Shareholders' equity:
6% Cumulative, convertible, voting preferred stock
par value $.10 per share
Authorized shares - 1,000,000
Issued and outstanding - 63,600
Liquidation preference of $858,600 6,360
Common stock - par value $.10 per share
Authorized - 2,000,000
Issued 1,276,038 and outstanding 1,233,214 127,604
Additional paid-in capital 8,807,942
Accumulated other comprehensive income,
net of deferred taxes 1,258,791
Retained earnings 3,038,766
Treasury stock, at cost, 42,824 shares (397,051)
-----------
Total shareholders' equity 12,842,412
-----------
Total liabilities & shareholders' equity $ 30,595,908
===========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 4
<TABLE>
<CAPTION>
Santa Fe Financial Corporation
Consolidated Statement of Income and Comprehensive Income
(Unaudited)
For three months ended June 30, 1999 1998
--------- --------
<S> <C> <C>
Revenues
Equity in net income of Justice
Investors $ 961,284 $ 847,709
Dividend and interest income 211,115 182,191
Net gains (losses) on marketable
securities 431,036 (1,435,732)
Rental income 152,587 141,135
Other income 21,652 34,176
--------- ---------
1,777,674 (230,521)
--------- ---------
Costs and expenses
Property operating expense 123,457 117,855
Mortgage interest expense 29,080 29,375
Depreciation expense 43,801 66,063
Margin interest and investment
related expenses 184,803 103,852
Litigation 14,471 9,993
General and administrative 268,387 262,715
--------- ---------
663,999 589,853
--------- ---------
Income (loss) before income taxes
and minority interest 1,113,675 (820,374)
Income tax (expense) benefits (390,505) 212,000
--------- ---------
Income (loss) before minority interest 723,170 (608,374)
Minority interest (282,617) (74,249)
--------- ---------
Net income (loss) $ 440,553 $ (682,623)
========= =========
Basic earnings (loss) per share $ 0.36 $ (0.53)
========= =========
Weighted average number of shares
outstanding 1,235,950 1,276,038
========= =========
Comprehensive income
Net income (loss) $ 440,553 $ (682,623)
Other comprehensive income:
Unrealized holding gain (loss)
on marketable securities 1,278,756 (2,360,967)
Reclassification adjustment for holding
loss (gain) included in net earnings (431,036) 1,435,732
Income tax (expense) benefit related to
other comprehensive income (365,359) 674,562
--------- ---------
Total comprehensive income $ 922,914 $ (933,296)
========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 5
<TABLE>
<CAPTION>
Santa Fe Financial Corporation
Consolidated Statement of Income and Comprehensive Income
(Unaudited)
For six months ended June 30, 1999 1998
--------- --------
<S> <C> <C>
Revenues
Equity in net income of Justice
Investors $1,525,683 $1,454,109
Dividend and interest income 410,680 343,221
Net losses on marketable securities (561,926) (1,042,055)
Rental income 306,065 267,279
Other income 19,686 62,352
--------- ---------
1,700,188 1,084,906
--------- ---------
Costs and expenses
Property operating expense 165,856 222,759
Mortgage interest expense 59,989 62,251
Depreciation expense 88,273 93,030
Margin interest and investment
related expenses 331,986 231,227
Litigation 14,471 41,780
General and administrative 449,597 489,245
--------- ---------
1,110,172 1,140,292
--------- ---------
Income (loss) before income taxes
and minority interest 590,016 (55,386)
Income tax expense (200,605) (63,800)
--------- ---------
Income (loss) before minority interest 389,411 (119,186)
Minority interest (524,938) (182,747)
--------- ---------
Net loss $ (135,527) $(301,933)
========= =========
Basic loss per share $ (0.11) $ (0.24)
========= =========
Weighted average number of shares
outstanding 1,237,774 1,276,038
========= =========
Comprehensive income
Net loss $ (135,527) $ (301,933)
Other comprehensive income:
Unrealized holding (loss) gain
on marketable securities 851,623 (733,324)
Reclassification adjustment for holding
loss included in net earnings 561,926 1,042,055
Income tax benefit (expense) related to
other comprehensive income (243,321) 209,521
--------- ---------
Total comprehensive income $1,034,701 $ 216,319
========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 6
<TABLE>
<CAPTION>
Santa Fe Financial Corporation
Consolidated Statement of Cash Flows
(Unaudited)
For the six months ended June 30, 1999 1998
----------- -----------
<S> <C> <C>
Operating activities
Net loss $ (135,527) $ (301,933)
Adjustments to reconcile net income to
net cash provided by (used in) operating
activities:
Equity in net income of Justice Investors (1,525,683) (1,454,109)
Net loss on marketable securities 561,926 1,042,055
Minority interest 524,938 182,747
Amortization of excess of market value
over carrying value (44,352) (44,352)
Depreciation expense 88,273 93,030
Changes in operating assets and liabilities
Other assets (867,023) 127,434
Decrease in accounts receivable 32,963 -
Accounts payable and accrued expenses 1,392,065 (435,785)
Restricted cash 6,521 57,533
---------- ----------
Net cash provided by (used in) operating
activities 34,101 (733,380)
---------- ----------
Investing activities
Cash distributions from Justice Investors 836,640 836,640
Purchase of Portsmouth Square stock - (100,927)
Purchase of marketable securities (18,194,908) (20,068,908)
Purchase of other investments (147,568) (300,000)
Proceeds from sale of marketable securities 17,999,808 27,886,724
Purchase of property, furniture and fixtures (17,890) (90,426)
---------- ----------
Net cash provided by investing activities 476,082 8,163,103
---------- ----------
Financing activities
Decrease in due to securities broker (1,887,362) (5,666,507)
Increase in obligations for securities sold 1,600,408 -
Mortgage principal payment (10,219) (9,319)
Dividends paid to minority shareholders
of Portsmouth Square (63,357) (63,357)
Decrease in notes receivable - 169,920
Purchase of treasury stock (86,417) -
---------- ----------
Net cash used in financing activities (446,947) (5,569,263)
---------- ----------
Net increase in cash and cash equivalents 63,236 1,860,460
Cash and cash equivalents at beginning of period 109,483 382,021
---------- ----------
Cash and cash equivalents at end of period $ 172,719 $ 2,242,481
========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 7
SANTA FE FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation and Significant Accounting Policies
---------------------------------------------------------
The consolidated financial statements included herein have been prepared by
Santa Fe Financial Corporation (the "Company"), without audit, according to
the rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although the
Company believes the disclosures that are made are adequate to make the
information presented not misleading. Further, the consolidated financial
statements reflect, in the opinion of management, all adjustments (which
included only normal recurring adjustments) necessary to state fairly the
financial position and results of operations as of and for the periods
indicated.
Certain reclassifications have been made to the financial statements as of June
30, 1999 and for the six months then ended to conform with the current quarter
presentation.
It is suggested that these financial statements be read in conjunction with
the audited financial statements and the notes therein included in the
Company's Form 10-KSB for the year ended December 31, 1998.
The results of operations for the three and six months ended June 30, 1999 are
not necessarily indicative of results to be expected for the full fiscal year
ending December 31, 1999.
2. Investment in Justice Investors
-------------------------------
The Company's principal source of revenue continues to be derived from the
investment of its 67.4%-owned subsidiary, Portsmouth Square, Inc.
("Portsmouth") in the Justice Investors limited partnership ("Justice
Investors"). Portsmouth has a 49.8% interest in the limited partnership, which
derives most of its income from a lease of its San Francisco, California hotel
property to Felcor Lodging Trust, Inc. ("Felcor") and from a lease with Evon
Garage Corporation ("Evon"). Portsmouth also serves as one of the two general
partners of Justice Investors. Portsmouth records its investment on the equity
basis.
<PAGE> 8
Condensed financial statements for Justice Investors are as follows:
JUSTICE INVESTORS
CONDENSED BALANCE SHEET
June 30, 1999
--------------
Assets
Total current assets $1,153,482
Property, plant and equipment, net of
accumulated depreciation of $11,182,242 5,389,139
Loan fees and deferred lease costs,
net of accumulated amortization of $102,739 178,109
---------
$6,720,730
=========
Liabilities and partners' equity
Total current liabilities $ 32,843
Long-term debt 500,000
Partners' equity 6,187,887
Total liabilities and ---------
partners' equity $6,720,730
=========
JUSTICE INVESTORS
CONDENSED STATEMENTS OF OPERATIONS
For six months ended June 30, 1999 1998
---------- ----------
Revenues $3,500,010 $3,429,431
Costs and expenses 436,388 509,533
--------- ---------
Net income $3,063,622 $2,919,898
========= =========
3. Investment in Marketable Securities
-----------------------------------
The Company has classified its portfolio of marketable investment securities as
available-for-sale and has reported it at fair value, as primarily determined by
quoted market prices, with unrealized gains and losses, net of deferred taxes,
reported in accumulated other comprehensive income. Any unrealized gains or
losses related to short positions are recognized in earnings in the current
period. The Company borrows funds from securities brokers to purchase marketable
securities under standard margin agreements.
Certain securities may be classified as trading securities to correspond with
obligations of the same securities sold short. These securities and the related
obligations are marked to market with unrealized holding gains and losses
included in earnings.
Realized gains and losses are included in net losses on marketable securities.
The cost of securities sold is determined based on the specific identification
method. Interest and dividends from securities classified as available-for-sale
are included in investment and interest income.
<PAGE> 9
4. Related Party Transactions
--------------------------
As of June 30, 1999, InterGroup owned approximately 45.5% of the Company's
outstanding common stock and 100% of the Company's preferred stock for a total
of 48.2% of all outstanding voting stock. In addition, the Chairman and Chief
Executive Officer of InterGroup, who is also the Company's Chairman and Chief
Executive Officer, owned approximately 4% of the Company's outstanding common
stock as of June 30, 1999. Effective June 30, 1998, the Company's Chairman and
Chief Executive Officer entered into a voting trust agreement with InterGroup,
giving InterGroup the power to vote the shares that he owns in the Company. As
a result of that agreement, InterGroup now has the power to vote in excess of
52% of the voting shares of the Company.
Certain costs and expenses, primarily salaries, rent and insurance, are
allocated among the Company and its subsidiary, Portsmouth, and the Company's
parent, The InterGroup Corporation ("InterGroup"), based on management's
estimate of the utilization of resources. For the six months ended June 30,
1999, the Company and Portsmouth made payments to InterGroup of approximately
$64,350 for administrative costs and reimbursement of direct and indirect costs
associated with the management of the Companies and their investments, including
the partnership asset.
The Company's President and Chief Executive Officer, John V. Winfield, directs
the investment activity of the Company in public and private markets pursuant to
authority granted by the Board of Directors. Mr. Winfield also serves as Chief
Executive Officer of Portsmouth and InterGroup and directs the investment
activity of those companies. Effective April 1, 1998, an employee of InterGroup
was assigned to manage the portfolios of the Company and Portsmouth in
consultation with Mr. Winfield. The Company and Portsmouth reimburse InterGroup
for an allocated portion of the compensation and benefits of such employee.
Depending on certain market conditions and various risk factors, the Chief
Executive Officer, his family, Portsmouth and InterGroup may, at times, invest
in the same companies in which the Company invests. The Company encourages such
investments because it places personal resources of the Chief Executive Officer
and his family members, and the resources of Portsmouth and InterGroup, at risk
in connection with investment decisions made on behalf of the Company. All of
the Company's Directors serve as directors of InterGroup and all three of the
Company's Directors serve on the Board of Portsmouth.
5. Commitments and Contingencies
-----------------------------
During 1997, the Company and the director defendants prevailed in their defense
of a shareholders' derivative suit related to the private placement of 90,000
shares of common stock and warrants for the purchase of an additional 90,000
shares to InterGroup. As prevailing parties, the Company and the director
defendants made application to the Superior Court for recovery of the
attorney's fees and costs expended in the successful defense of this litigation.
During March 1998, the trial court entered a judgment in favor of the Company
and the director defendants and granted the applications for attorneys' fees and
costs in the total amount of approximately $936,000. That award bears interest
at the statutory rate of 10% per annum and has been appealed by the plaintiffs
in that action.
<PAGE> 10
6. Subsequent Event
----------------
In April 1999, the Company's 55.4%-owned subsidiary, Intergroup Woodland
Village, Inc. ("Woodland") entered into a contract to sell its 100-unit
apartment complex in Cincinnati, Ohio for $3,125,000. The escrow on that
sale closed on July 30, 1999.
Item 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS AND PROJECTIONS
The Company may from time to time make forward-looking statements and
projections concerning future expectations. When used in this discussion, the
words "estimate," "project," "anticipate" and similar expressions, are
intended to identify forward-looking statements. Such statements are subject
to certain risks and uncertainties, including partnership distributions,
general economic conditions of the hotel industry in the San Francisco area,
securities markets, litigation and other factors, including natural disasters
and those discussed below and in the Company's Form 10-KSB for the year ended
December 31, 1998, that could cause actual results to differ materially from
those projected. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as to the date hereof. The
Company undertakes no obligation to publicly release the results of any
revisions to those forward-looking statements which may be made to reflect
events or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
RESULTS OF OPERATIONS
The Company's principal sources of revenue continue to be derived from the
investment of its 67.4% owned subsidiary, Portsmouth, in the Justice Investors
limited partnership, rental income from its multi-family real estate property
investment and income received from investment of its cash and securities
assets. The partnership derives most of its income from a lease of its hotel
property to Felcor and from a lease with Evon Garage Corporation.
Three Months Ended June 30, 1999 Compared to Three Months
Ended June 30, 1998
Comparison of operating results for the three months ended June 30, 1999 to the
three months ended June 30, 1998 shows net income of $440,553 as compared to a
net loss of $682,623. That result is primarily attributable to a 13.4% increase
in partnership income to $961,284 from $847,709 and net gains on marketable
securities of $431,036 compared to a net loss of $1,435,732 during the second
quarter of 1998. Dividend and interest income also increased 15.9% to $211,115
from $182,191.
The net gains in marketable securities of $431,036 compared to the net loss of
$1,435,732 reflects management's efforts to reposition the Company's investment
portfolio by selling certain underperforming securities during the three months
ended June 30, 1998. Realized gains and losses on marketable securities may
fluctuate significantly from period to period in the future and could have a
meaningful effect on the Company's net earnings. However, the amount of
realized gain or loss on marketable securities for any given period may have no
<PAGE> 11
predictive value, and variations in amount from period to period may have no
practical analytical value.
The increase in partnership income is attributable to greater hotel rental
income, primarily as a result of higher room rates, and the increase in garage
rental income. Rental income from Woodland Village was consistent with the
previous quarter.
The modest 12.5% increase in costs and expenses to $663,999 from $589,853
primarily reflects increased margin interest and investment related expenses due
to the increased size of the Company's investment portfolio.
Six Months Ended June 30, 1999 Compared to Six Months Ended June 30, 1998
Comparison of operating results for the six months ended June 30, 1999 to the
six months ended June 30, 1998 shows a net loss of $135,527 as compared to a net
loss of $301,933. That result is primarily attributable to net losses on
marketable securities of $561,926 compared to losses of $1,042,055 for the first
six months of 1998. Partnership income increased 4.9% to $1,525,683 from
$1,454,109, dividend and interest income increased 19.7% to $410,680 from
$343,221 and rental income from Woodland Village increased 14.5% to $306,065
from $267,279.
The net loss on marketable securities reflects management's continuing efforts
to reposition the Company's investment portfolio by selling certain
underperforming securities. Realized gains and losses on marketable securities
may fluctuate significantly from period to period in the future and could have a
meaningful effect on the Company's net earnings. However, the amount of
realized gain or loss on marketable securities for any given period may have no
predictive value, and variations in amount from period to period may have no
practical analytical value.
The increase in partnership income was primarily attributable to an increase in
garage rental income and a small increase in hotel rental income which was
impacted by the loss of meeting rooms and other revenues while the common areas
of the hotel were being renovated in January and February 1999. The increase in
rental income from Woodland Village was due to higher rental rates and increased
occupancy for the property.
Costs and expenses decreased 2.6%, reflecting lower operating costs for Woodland
Village, fewer litigation costs associated with the GPG litigation and a
decrease in general and administrative expenses, partially offset by increased
margin interest and investment related expenses due to the increased size of the
Company's investment portfolio.
FINANCIAL CONDITION AND LIQUIDITY
The Company's cash flows are primarily generated by its subsidiary's investment
in the Justice Investors limited partnership, which derives the majority of its
income from its lease with Felcor and a lease with Evon. In addition to the
monthly limited partnership distributions it receives from Justice Investors,
Portsmouth also receives monthly management fees as a general partner. The
Company also derives revenue from its investment in a multi-family real estate
property and the investment of its cash and securities assets. On July 30, 1999,
escrow closed on the sale of the Woodland Village property for a contract sales
price of $3,125,000.
<PAGE> 12
As a result of increases in the amount of rental income from the hotel lease,
the general partners of Justice Investors decided that there would be a
special one-third increase in the monthly distribution to limited partners
effective with the February 1997 distribution. As a result, Portsmouth's
monthly distribution increased to $139,440 from $109,580. The general partners
decided to continue monthly distributions at the higher monthly rate for 1998
and 1999. The increases in monthly distributions were clearly identified as
special distributions and, at any time, unforeseen circumstances could dictate a
change in the amount distributed. The general partners will continue to conduct
an annual review and analysis to determine an appropriate monthly distribution
for the ensuing year. At that time, the monthly distribution could be increased
or decreased. For the six months ended June 30, 1999, Portsmouth received cash
distributions of $836,640 from Justice Investors.
The Company has invested in short-term, income-producing instruments and in
equity and debt securities when deemed appropriate. The Company's marketable
securities are classified as available-for-sale and unrealized gains and losses,
net of deferred taxes, are included in accumulated other comprehensive income.
As of June 30, 1999, the Company had gross unrealized gains of $6,778,621 and
gross unrealized losses of $3,721,542 on marketable securities.
Certain securities may be classified as trading securities to correspond with
obligations of the same securities sold short. These securities and the related
obligations are marked to market with unrealized holding gains and losses
included in earnings. Gross realized gains related to trading securities
totaled $1,148,007.
On August 14, 1998 the Company authorized a limited buy-back program of its
Common Stock. The Company may from time to time, in the discretion of
management, buy back shares of its Common Stock, depending on market conditions
and other factors consistent with corporate policy and as limited by state and
federal law. As of June 30, 1999, the Company had repurchased 42,824 of its
shares in open market and private transactions for an aggregate amount of
$397,051.
At June 30, 1998, the Company's current assets were $19,653,551. The Company
remains liquid and management believes that its capital resources are currently
adequate to meet its short and long-term obligations.
YEAR 200O ISSUES
The Company is aware of the potential implications that the year 2000 ("Y2K")
issue could have on its business and as a result, is in the process of
determining what, if any, steps the Company must take to cure any potential
software or hardware problems associated with Y2K. The Company has hired
professional outside consultants to assist it in addressing its Y2K needs. The
Company's plans include upgrading existing software applications to make them
Y2K compliant, replacing some hardware required by software upgrades, purchasing
new computer hardware and upgrading its computer network and communication
systems. The Company has also contacted its suppliers of various services and
materials regarding their readiness and plans for Y2K.
Based on discussions with the Company's outside consultants, service providers
and software and hardware vendors, the Company has determined that its systems,
both information technology and non-information technology, are not reasonably
likely to be impacted by Y2K and that the costs to complete the Y2K compliance
will not have a material effect on the Company's financial position or results
of operations. Management expects to be Y2K compliant by September 30, 1999.
<PAGE> 13
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Shareholders of the Company was held on May 4, 1999,
at the Park Hyatt Hotel in Los Angeles, California. At that meeting all of
management's nominees, John V. Winfield, John C. Love and William J.
Nance, were elected Directors of Santa Fe to serve until the next Annual
Meeting. The shareholders also voted to ratify the appointment of Price-
waterhouseCoopers LLP as the Company's independent accountants for the year
ending December 31, 1999. A tabulation of the votes at that meeting for each of
those proposals was reported in the Company's Form 10-QSB for the quarterly
period ended March 31, 1999.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 27 - the Financial Data Schedule is filed as an exhibit
to this report.
(b) Registrant filed no reports on Form 8-K
during the period covered by this report:
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.
SANTA FE FINANCIAL CORPORATION
(Registrant)
Date: August 2, 1999 by /s/ John V. Winfield
----------------------------
John V. Winfield, President,
Chairman of the Board and
Chief Executive Officer
Date: August 2, 1999 by /s/ David Nguyen
-----------------------------
David Nguyen, Controller
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
BALANCE SHEET AND STATEMENT OF INCOME AND COMPREHENSIVE INCOME OF
SANTA FE FINANCIAL CORPORATION AND SUBSIDIARIES SET FORTH IN ITS FORM
10-QSB REPORT FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1999 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH 10-QSB REPORT.
</LEGEND>
<CIK> 0000086759
<NAME> SANTA FE FINANCIAL CORPORATION
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-Mos
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 219621
<SECURITIES> 18890016
<RECEIVABLES> 101579
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 19653551
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 30595908
<CURRENT-LIABILITIES> 12613600
<BONDS> 0
0
0
<COMMON> 127604
<OTHER-SE> 13024310
<TOTAL-LIABILITY-AND-EQUITY> 30595968
<SALES> 0
<TOTAL-REVENUES> 1700188
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1110172
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 590016
<INCOME-TAX> 200605
<INCOME-CONTINUING> (135527)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (135527)
<EPS-BASIC> (.11)
<EPS-DILUTED> (.11)
</TABLE>
