RESTON, VA, Aug 09, 2007 (MARKET WIRE via COMTEX News Network) -- Comstock Homebuilding Companies, Inc. (NASDAQ: CHCI) ("Comstock" or
the "Company") today announced financial results for three and six
months ended June 30, 2007.
For the three months ended June 30, 2007 the Company reported a net
loss of $4.7 million or ($0.29) per share basic and diluted on total
revenue of $114.3 million as compared to a net loss of $7.1 million
or $(0.47) per share basic and diluted for the three months ended
June 30, 2006. In connection with these results the Company
announced that it had elected to record a non-cash impairment and
write-off charge of $7.5 million for the three months ended June 30,
2007 as compared to a $12.9 million charge for the three months ended
June 30, 2006.
For the six months ended June 30, 2007 the Company reported a net
loss of $6.3 million or ($0.40) per share basic and diluted on total
revenue of $161.0 million as compared to a net loss of $5.9 million
or $(0.41) per share basic and diluted for the six months ended June
30, 2006. In connection with these results the Company announced
that it had elected to record a non-cash impairment and write-off
charge of $8.4 million for the six months ended June 30, 2007 as
compared to a $12.9 million charge for the six months ended June 30,
2006.
The Company noted that during the three months ended June 30, 2007 it
reduced its debt by $63.3 million to $230.1 million as compared to
March 31, 2007 and by $86.4 million as compared to June 30, 2006. The
company's debt-to-cap ratio at June 30, 2007 was 65%, a reduction of 5
percentage points as compared to March 31, 2007. In addition, the
Company indicated that it continued to be successful in both
complying with all of its financial covenants and extending the
maturities and cash obligations associated with its debt.
Selected Highlights of Financial Results -- Three months ended June
30,
2007:
- The Company reported a net loss of $4.7 million or ($0.29) per share
basic and diluted on weighted average shares outstanding of 16.1 million as
compared to a net loss of $7.1 million or ($0.47) per share basic and
diluted on 15.0 million weighted average shares outstanding for the three
months ended June 30, 2006;
- On a proforma basis, before impairments and write-offs, the Company's
results would have been a net loss of $0.1 million or $0.00 per share
(basic) as compared to net income of $0.8 million or $0.05 per share
(basic) for the three moths ended June 30, 2006;
- Total revenue was $114.3 million with revenue from homebuilding
increasing $59.9 million or 118.8% to $110.3 million, as compared to total
revenue of $50.7 million for the three months ended June 30, 2006 with
$50.4 million of revenue derived from homebuilding;
- The Company delivered 505 new homes including 316 units at its
Bellemeade project at an average per unit revenue of approximately $218,000
as compared to 165 new homes at an average per unit revenue of $305,000 for
the three months ended June 30, 2006. Net of the $47.5 million of revenue
from the Bellemeade units the Company's average revenue per delivery was
$332,000;
- Gross profit from homebuilding, was $7.4 million on a proforma basis
before impairments and write-offs representing a 6.7% gross margin as
compared to $9.1 million representing a gross margin from homebuilding of
18% for the three months ended June 30, 2006. Net of the Bellemeade units
the Company's gross margin from homebuilding was 11.9%;
- Gross new order revenue was $99.1 million on 494 new orders including
316 units at its Bellemeade project for an average new order revenue of
$201,000 as compared to $66.3 million of new order revenue on 199 new
orders for an average of $285,000 per new order for the three months ended
June 30, 2006. Net of the Bellemeade units the Company's average new order
was $290,000;
- Backlog at June 30, 2007 was $92.8 million on 241 units as compared to
$218.4 million on 575 units at June 30, 2006;
- As a result of softening market conditions and project repositioning
in the Company's markets, the Company elected to record a $7.5 million non-
cash charge to assets for impairments to its real estate inventory;
Selected Highlights of Financial Results -- Six months ended June
30, 2007:
- The Company reported a net loss of $6.3 million or ($0.40) per share
basic and diluted on weighted average shares outstanding of 16.0 million as
compared to a net loss of $5.9 million or ($0.41) per share basic and
diluted on 14.5 million weighted average shares outstanding for the six
months ended June 30, 2006;
- On a proforma basis, before impairments and write-offs, the Company's
results would have been a net loss of $1.1 million or ($0.07) per share
(basic) as compared to net income of $2.0 million or $0.14 per share
(basic) for the six moths ended June 30, 2006;
- Total revenue was $161.0 million with revenue from homebuilding
increasing $66.6 million or 76.8% to $153.3 million, as compared to total
revenue of $87.3 million for the six months ended June 30, 2006 with $86.7
million of revenue derived from homebuilding;
- The Company delivered 636 new homes including 316 units at its
Bellemeade project at an average per unit revenue of approximately $241,000
as compared to 277 new homes at an average per unit revenue of $313,000 for
the six months ended June 30, 2006. Net of the Bellemeade units the
Company's average revenue per delivery was $331,000;
- Gross profit from homebuilding, was $13.6 million on a proforma basis
before impairments and write-offs representing an 8.9% gross margin as
compared to $18.3 million representing a gross margin from homebuilding of
21.1% for the six months ended June 30, 2006. Net of the Bellemeade units
the Company's gross margin from homebuilding was 12.9%;
- Gross new order revenue was $143.0 million on 639 new orders including
316 units at its Bellemeade project for an average new order revenue of
$224,000 as compared to $141.9 million of new order revenue on 462 new
orders for an average of $307,000 per new order for the six months ended
June 30, 2006. Net of the Bellemeade units the Company's average new order
was $296,000;
- Backlog at June 30, 2007 was $92.8 million on 241 units as compared to
$218.4 million on 575 units at June 30, 2006;
- As a result of softening market conditions and project repositioning
in the Company's markets, the Company elected to record a $8.4 million non-
cash charge to assets for impairments to its real estate inventory;
"We are encouraged by our results and accomplishments during the
second quarter," said Christopher Clemente, Chairman and Chief
Executive Officer. "We recognize the challenges that this market
presents and feel that we are taking the necessary steps to
strengthen our balance sheet and manage our liquidity. The
significant reduction in debt this quarter is an indication of our
commitment to selling through our inventory and reducing our exposure
to unfunded interest costs. In addition, the commencement of
settlements in the east tower of the Eclipse is a positive step
toward realizing what we continue to believe will be significant cash
flow from the project."
The Company will file its 10-Q later today. The Company will hold an
investor conference call hosted by Christopher Clemente, Chief
Executive Officer, and Bruce Labovitz, Chief Financial Officer on
Monday, August 13, 2007 at 1:00 p.m. Eastern Time, to discuss
financial results for the second quarter ended June 30, 2007. This
investor call will be available via live webcast on the Company
website at http://www.comstockhomebuilding.com in the "Investor
Relations" section. To participate by telephone, the dial-in number
is 866-542-4236 and the access code is 3229093. Investors are advised
to join at least five minutes prior to the call to register. The call
will be archived for seven days: from 6:45 p.m. Monday, August 13,
2007, until 11:59 p.m. Monday, August 20, 2007.
About Comstock Homebuilding Companies, Inc.
Established in 1985, Comstock Homebuilding Companies is a diversified
real estate development firm with a focus on moderately priced
for-sale residential products. Comstock builds and markets
single-family homes, townhouses, mid-rise condominiums, high-rise
condominiums, mixed-use urban communities and active adult
communities. The company currently markets its products under the
Comstock Homes brand in the Washington, D.C.; Raleigh, North
Carolina; and Atlanta, Georgia metropolitan areas. Comstock develops
mixed-use, urban communities and active-adult communities under the
Comstock Communities brand. Comstock Homebuilding Companies Inc.
trades on Nasdaq under the symbol CHCI. For more information on the
Company or it projects please visit
http://www.comstockhomebuilding.com.
Cautionary Statement Regarding Forward-Looking Statements
This release contains "forward-looking" statements that are made
pursuant to the Safe Harbor provisions of the Private Securities
Litigation Reform Act of 1995. Statements that are predictive in
nature, that depend upon or refer to future events or conditions, or
that include words such as "may," "will," "expects," "projects,"
"anticipates," "estimates," "believes," "intends," "plans," "should,"
"seeks," and similar expressions, including statements related to
Comstock's expected future financial results and anticipated growth
in the Washington, D.C. housing market, are forward-looking
statements. Forward-looking statements involve known and
unknown risks and uncertainties that may cause actual future results
to differ materially from those projected or contemplated in the
forward-looking statements. These risks and uncertainties include,
but are not limited to, economic, market and competitive conditions
affecting Comstock and its operations and products, risks and
uncertainties relating to the market for real estate generally and in
the areas where Comstock has projects, the availability and price of
land suitable for development, materials prices, labor costs,
interest rates, Comstock's ability to service its significant debt
obligations, fluctuations in operating results, anticipated growth
strategies, continuing relationships with affiliates, environmental
factors, government regulations, the impact of adverse weather
conditions or natural disasters and acts of war or terrorism.
Additional information concerning these and other important risks and
uncertainties can be found under the heading "Risk Factors" in the
prospectus from Comstock's initial public offering, as filed with the
Securities and Exchange Commission on December 15, 2004. Comstock
specifically disclaims any obligation to update or revise any
forward-looking statements, whether as a result of new information,
future developments or otherwise.
June 30, December 31,
BALANCE SHEET 2007 2006
----------- -----------
ASSETS
Cash and cash equivalents $ 16,936 $ 21,263
Restricted cash 6,720 12,326
Receivables 2,974 4,555
Note receivables - -
Due from related parties 377 4,053
Real estate held for development and sale 330,038 405,144
Inventory not owned - variable interest
entities 35,458 43,234
Property, plant and equipment 2,322 2,723
Investment in real estate partnership - (171)
Deferred income tax 9,508 10,188
Other assets 18,351 14,114
----------- -----------
TOTAL ASSETS 422,684 517,429
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued liabilities 35,913 55,680
Due to related parties 140 1,140
Obligations related to inventory not owned 33,524 40,950
Notes payable 200,140 265,403
Senior unsecured debt 30,000 30,000
Notes payable - related party - -
Income taxes payable - -
----------- -----------
TOTAL LIABILITIES 299,717 393,173
----------- -----------
Commitments and contingencies (Note 12)
Minority interest 363 371
----------- -----------
SHAREHOLDERS' EQUITY
Class A common stock, $0.01 par value,
77,266,500 shares authorized, 14,961,779 and
14,129,081 issued and outstanding,
respectively 150 141
Class B common stock, $0.01 par value,
2,733,500 shares authorized, 2,733,500 issued
and outstanding 27 27
Additional paid-in capital 150,911 147,528
Treasury stock, at cost (391,400 Class A
common stock) (2,439) (2,439)
(Accumulated deficit) (26,045) (21,372)
----------- -----------
TOTAL SHAREHOLDERS' EQUITY 122,604 123,885
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 422,684 $ 517,429
=========== ===========
Three Months Ended Six Months Ended
Income Statement June 30, June 30,
-------------------- --------------------
2007 2006 2007 2006
--------- --------- --------- ---------
Revenues
Revenue - homebuilding $ 110,313 $ 50,351 $ 153,338 $ 86,716
Revenue - other 3,987 346 7,685 576
--------- --------- --------- ---------
Total revenue 114,300 50,697 161,023 87,292
Expenses
Cost of sales - homebuilding 102,876 41,295 139,743 68,456
Cost of sales - other 3,680 21 7,304 30
Impairments and write-offs 7,492 12,914 8,383 12,914
Selling, general &
administrative 8,151 8,429 16,376 16,076
--------- --------- --------- ---------
Operating loss (7,899) (11,962) (10,783) (10,184)
Other income, net (302) (355) (646) (587)
--------- --------- --------- ---------
Loss before minority interest
and equity in losses of real
estate partnership (7,597) (11,607) (10,137) (9,597)
Minority interest (3) 12 (5) 5
--------- --------- --------- ---------
Loss before equity in earnings
of real estate partnership (7,594) (11,619) (10,132) (9,602)
Equity in losses of real estate
partnership - (26) - (53)
--------- --------- --------- ---------
Total pre tax loss (7,594) (11,645) (10,132) (9,655)
Income taxes benefit (2,926) (4,522) (3,796) (3,771)
--------- --------- --------- ---------
Net loss $ (4,668) $ (7,123) $ (6,336) $ (5,884)
========= ========= ========= =========
Basic loss per share $ (0.29) $ (0.47) $ (0.40) $ (0.41)
Basic weighted average shares
outstanding 16,095 15,034 15,992 14,511
========= ========= ========= =========
Diluted loss per share $ (0.29) $ (0.47) $ (0.40) $ (0.41)
Diluted weighted average shares
outstanding 16,095 15,034 15,992 14,511
========= ========= ========= =========