Comstock(CHCI) - 2023 Q1 - Quarterly Report

Financial Performance - Total revenue for the three months ended March 31, 2023, was $10,275,000, an increase of 17.7% compared to $8,731,000 for the same period in 2022[59] - Net income for the three months ended March 31, 2023, was $754,000, a decrease of 56.9% compared to $1,747,000 for the same period in 2022[59] - The company reported a basic net income per share of $0.08 for the three months ended March 31, 2023, compared to $0.21 for the same period in 2022[59] - Net income from continuing operations for the three months ended March 31, 2023, was $754,000, a decrease of 62.6% compared to $2,014,000 for the same period in 2022[62] - The company recognized a tax provision of $0.2 million for the three months ended March 31, 2023, compared to a tax benefit of $0.5 million for the same period in 2022[124] - Adjusted EBITDA for the three months ended March 31, 2023, was $1.626 million, slightly up from $1.606 million in the same period of 2022[155] - The company reported a loss of $411,000 on real estate ventures for the three months ended March 31, 2023, compared to a gain of $252,000 in the same period of 2022[214] Operating Costs and Expenses - Operating costs and expenses totaled $8,954,000 for the three months ended March 31, 2023, up from $7,366,000 in the same period last year, representing a 21.5% increase[59] - Operating costs and expenses rose by 21.6% to $8.954 million in 2023, primarily due to a $1.0 million increase in personnel expenses[146] - The Company reported depreciation and amortization expenses of $67,000 for the three months ended March 31, 2023, an increase of 52.3% from $44,000 in the same period of 2022[62] - Stock-based compensation increased to $238,000 for the three months ended March 31, 2023, compared to $197,000 for the same period in 2022, reflecting a rise of 20.8%[62] Assets and Liabilities - Total assets decreased to $39,238,000 as of March 31, 2023, down from $42,473,000 as of December 31, 2022, reflecting a decline of 7.4%[23] - Total liabilities decreased to $9,685,000 as of March 31, 2023, down from $13,619,000 as of December 31, 2022, a reduction of 28.5%[23] - Stockholders' equity increased to $29,553,000 as of March 31, 2023, compared to $28,854,000 as of December 31, 2022, an increase of 2.4%[23] - Cash and cash equivalents decreased to $9,059,000 as of March 31, 2023, down from $11,722,000 as of December 31, 2022, a decline of 22.7%[23] - Cash and cash equivalents at the end of the period were $9,059,000, down from $11,560,000 at the end of the same period in 2022, representing a decrease of 21.6%[62] Cash Flow - Net cash used in operating activities was $(2,566,000) for the three months ended March 31, 2023, compared to $(1,952,000) for the same period in 2022, indicating a worsening cash flow situation[62] - Net cash provided by investing activities was $0.197 million in 2023, a significant improvement from $(1.785) million used in 2022[165] - The company’s operating cash flows from operating leases increased to $389,000 for the three months ended March 31, 2023, from $311,000 in the same period of 2022[doc->id='99'] Revenue Breakdown - Asset management revenue was $6.529 million, up from $5.997 million, representing an 8.9% increase year-over-year[136] - Property management revenue increased to $2.606 million from $2.131 million, a growth of 22.3%[136] - Parking management revenue rose to $1.140 million, compared to $603, reflecting an increase of 89.1%[136] - Total revenue increased by 17.7% in 2023, reaching $10.275 million compared to $8.731 million in 2022, driven by growth in asset management fees and additional assets[144] - Asset management revenue was $6.529 million, accounting for 63.5% of total revenue, while property management revenue was $2.606 million, representing 25.4% of total revenue[144] Strategic Initiatives - The Company completed the divestiture of CES for approximately $1.4 million, enhancing its focus on core asset management business[90] - The company has a development pipeline of 16 assets totaling 5.8 million square feet, which includes 6 office buildings and approximately 3,100 residential units[204] - The company completed the sale of Comstock Environmental Services, LLC on March 31, 2022, reflecting a strategic divestiture to focus on asset management growth[207] - A new asset management agreement was executed on June 13, 2022, which increased base fees and introduced a mark-to-market incentive fee based on the imputed profit of Anchor Portfolio assets[208] - The company operates under a fee-based, asset-light, and substantially debt-free business model, focusing on growth in managed portfolio and associated fee-based revenue[189] Joint Ventures and Investments - The Company’s ownership interest in BLVD Ansel was 5.0% as of March 31, 2023, with the property featuring 250 luxury apartment units and retail space[86] - The company’s ownership interest in the BLVD Forty Four joint venture was 5.0% as of March 31, 2023[105] - The company’s proportionate share of net income from the joint venture with Superior Title Services was immaterial for the three months ended March 31, 2023, compared to $0.1 million for the same period in 2022[106] - Total unconsolidated investments in real estate ventures decreased to $6,313,000 as of March 31, 2023, down from $7,013,000 as of December 31, 2022, reflecting a decline of 10%[92] Future Outlook - The company aims to maximize shareholder value while managing risks and pursuing growth opportunities in the greater Washington, D.C. area[210] - The company continues to monitor the impact of COVID-19, stating that it has not experienced significant effects to date, but acknowledges potential future risks[209]