American Realty Investors(US:ARL)2024-05-09 17:53Revenue and Income - Multifamily segment revenue increased to $8.053 million in Q1 2024 from $7.373 million in Q1 2023, a growth of approximately 9.2%[105] - Commercial segment revenue decreased to $3.226 million in Q1 2024 from $3.636 million in Q1 2023, a decline of approximately 11.3%[105] - Net income for Q1 2024 was $2.302 million, down from $4.219 million in Q1 2023, representing a decrease of about 45.5%[105] - Net income for the three months ended March 31, 2024, decreased by $1.9 million compared to the same period in 2023, primarily due to a decline in occupancy at Browning Place in the commercial segment[107] - Funds From Operations (FFO) for the three months ended March 31, 2024, was $4.98 million, down from $6.13 million in the same period in 2023[116] - FFO adjusted for the three months ended March 31, 2024, was $4.98 million, compared to $5.16 million in the same period in 2023[116] Expenses - Operating expenses for the multifamily segment rose to $4.219 million in Q1 2024, up from $3.708 million in Q1 2023, an increase of about 13.8%[105] - General, administrative, and advisory expenses decreased to $3.610 million in Q1 2024 from $5.566 million in Q1 2023, a reduction of approximately 35.2%[105] - Interest income decreased to $3.811 million in Q1 2024 from $5.155 million in Q1 2023, a decline of about 26.0%[105] - The decrease in interest income was $2.6 million, partially offset by a $1.2 million decrease in interest expense due to changes in interest rates and repayment of bonds[107] Development and Financing - The company incurred $18.9 million in development costs for the Lake Wales multifamily property as of March 31, 2024, with total expected costs of approximately $55.3 million[95] - A $33.0 million construction loan was secured for the Lake Wales development, which is expected to be completed in 2025[95] - The company entered into a $25.4 million construction loan for the Merano development, expected to be completed in 2025[96] - A total of $24.3 million is allocated for the development of 470 land lots in Windmill Farms, with completion expected over a two-year period starting Q3 2024[94] - The net cash used in financing activities decreased significantly by $87.67 million, primarily due to the repayment of bonds in 2023[111] - The company plans to selectively sell land and income-producing assets and refinance existing real estate debt to meet liquidity requirements[109] Cash Flow - Cash provided by operating activities increased to $3.87 million in Q1 2024 from $1.54 million in Q1 2023, a variance of $2.33 million attributed to a decrease in interest payments[110] - The company anticipates that cash and cash equivalents as of March 31, 2024, will be sufficient to meet all cash requirements, supported by cash generated from notes receivable and short-term investments[109] - The cash flow from investing activities changed by $35.8 million, mainly due to a $51.1 million increase in net purchases of short-term investments[111] Profitability - The multifamily segment saw a profit increase of $0.1 million due to the lease-up of the Redevelopment Property[107]