Exhibit 99.1*

 

NEWS RELEASE

 

FOR IMMEDIATE RELEASE

 

 

 

Contact:

Income Opportunity Realty Investors, Inc.

Investor Relations
Gene Bertcher (800) 400-6407
investor.relations@incomeopp-realty.com

 

 

Income Opportunity Realty Investors, Inc. Reports Third Quarter 2018 Results

DALLAS (November 14, 2018) Income Opportunity Realty Investors, Inc. (NYSE MKT: IOT), a Dallas-based real estate investment company, today reported results of operations for the third quarter ended September 30, 2018. For the three months ended September 30, 2018, we reported a net income applicable to common shares of $5.9 million or $1.44 per diluted share for the three months ended September 30, 2018, as compared to net income of $0.6 million or $0.15 per diluted share for the same period ended 2017.

 

Our primary business is investing in real estate and mortgage note receivables. Land held for development or sale has been our sole operating segment.

Revenues

Land held subject to a sales contract has been our sole operating segment. There was no operating revenue generated from this segment for the three months ended September 30, 2018, as well as the similar period in 2017. As of September 30, 2018, all land was sold and in the three months ended September 30, 2018 a gain in the amount of $7.3 million was recognized.

Expenses

 

There were no property operating expenses for the three months ended September 30, 2018 as well as in the similar period in 2017.

 

General and administrative expenses were $83,000 for the three months ended September 30, 2018. This represents a decrease of $10,000, as compared to the prior period general and administrative expenses of $93,000. This decrease was primarily due to an increase in audit fees and cost reimbursements to our Advisor of approximately $2,000 offset by a decrease in legal fees of approximately $12,000.

Advisory fees were $168,000 for the three months ended September 30, 2018 compared to $166,000 for the same period of 2017 for an increase of $2,000. Advisory fees are computed based on a gross asset fee of 0.0625% per month (0.75% per annum) of the average of the gross asset value.

 

Net income fee to related party increased $330,000 to $383,000 for the three months ended September 30, 2018 compared to the prior period. The net income fee paid to our Advisor is calculated at 7.5% of net income.

Other income (expense)

 

Interest income increased to $1.2 million for the three months ended September 30, 2018 compared to $0.9 million for the same period of 2017.  The increase of $0.3 million was due primarily to increase in advisory fee balance.

 

 

About Income Opportunity Realty Investors, Inc.

 

Income Opportunity Realty Investors, Inc., a Dallas-based real estate investment company, holds a portfolio of equity real estate in Texas, including undeveloped land. The Company invests in real estate through direct equity ownership and partnerships. For more information, visit the Company’s website at www.incomeopp-realty.com.

 

 
 

 

 

 

                     
INCOME OPPORTUNITY REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS 
(Unaudited)
       Three Months Ended September 30,        Nine Months Ended September 30,  
      2018   2017     2018   2017
      (dollars in thousands, except per share amounts)
Revenues:           
  Rental and other property revenues    $                -       $            -         $             -       $            -   
                     
Expenses:                  
  Property operating expenses                       0                  -                         0                  -   
  General and administrative (including $67 and $63 for the three months and $201 and $174 for the nine months ended 2018 and 2017, respectively, to related parties)                     83                 93                  359               342
  Net income fee to related party                   383                 53                  489               189
  Advisory fee to related party                   168               166                  500               493
       Total operating expenses                    634               312               1,348            1,024
       Net operating loss                 (634)                (312)                (1,348)             (1,024)
                     
Other income (expenses):                  
  Interest income from related parties                1,201               924               3,324            3,133
  Other Income                      -                     -                        -                  250
          Total other income                 1,201               924               3,324            3,383
  Income before gain on sale of real estate land                   567               612               1,976            2,359
  Gain on sale of real estate land                7,323                  -                  7,323                  -   
  Income before taxes                7,890                 612                 9,299              2,359
  Income tax (expense) - current              (1,902)                  -                 (1,902)                  -   
  Net income    $          5,988    $         612      $       7,397    $      2,359
                     
  Earnings per share - basic and diluted                  
     Net income     $            1.44    $        0.15      $         1.77    $        0.57
                     
  Weighted average common shares used in computing earnings per share   4,168,214   4,168,214     4,168,214   4,168,214
                     
                     
The accompanying notes are an integral part of these consolidated financial statements. 


 
 

 

INCOME OPPORTUNITY REALTY INVESTORS, INC.
CONSOLIDATED BALANCE SHEETS
 
        September 30,   December 31,
      2018   2017
        (unaudited)   (audited)
        (dollars in thousands, except par value amount)
    Assets        
Real estate land holdings subject to sales contract, at cost        $                             -    $                    22,717
    Total real estate                                   -                          22,717
             
Notes and interest receivable from related parties                              13,577                          14,030
    Total notes and interest receivable                          13,577                          14,030
Cash and cash equivalents                                        1                                   2
Receivable and accrued interest from related parties                              81,720                          49,631
Other assets                                        -                            1,517
    Total assets    $                    95,298    $                    87,897
             
    Liabilities and Shareholders’ Equity        
Liabilities:            
  Accounts payable and other liabilities    $                           14    $                           10
    Total liabilities                                 14                                 10
Shareholders’ equity:            
  Common stock, $0.01 par value, authorized 10,000,000 shares; issued 4,173,675 and outstanding 4,168,214 shares in 2018 and 2017                                 42                                 42
  Treasury stock at cost, 5,461 shares in 2018 and 2017                               (39)                               (39)
  Paid-in capital                           61,955                          61,955
  Retained earnings                           33,326                          25,929
    Total shareholders' equity                          95,284                          87,887
    Total liabilities and shareholders' equity    $                    95,298    $                    87,897
             
             
The accompanying notes are an integral part of these consolidated financial statements. 

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