-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CiGMf/B02KEIEgZuQ5xvP8U16L8+Pt9gWtq4RNJkvkqTttY9O+EwcgL1/SSQzK1l AU0Htox+tstO0IZWYO+8nQ== 0000752642-99-000005.txt : 19991117 0000752642-99-000005.hdr.sgml : 19991117 ACCESSION NUMBER: 0000752642-99-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 19991115 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED MOBILE HOMES INC CENTRAL INDEX KEY: 0000752642 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 221890929 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-12690 FILM NUMBER: 99751330 BUSINESS ADDRESS: STREET 1: 125 WYCKOFF RD CITY: EATONTOWN STATE: NJ ZIP: 07724 BUSINESS PHONE: 7323893890 MAIL ADDRESS: STREET 1: P O BOX 335 STREET 2: 125 WYCKOFF ROAD CITY: EATONTOWN STATE: NJ ZIP: 07724 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ( x ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1999 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period ended _________________________ For Quarter Ended Commission File Number September 30, 1999 0-13130 UNITED MOBILE HOMES, INC. (Exact name of registrant as specified in its charter) New Jersey 22-1890929 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) identification number) 125 Wyckoff Road, Eatontown, New Jersey 07724 Registrant's telephone number, including area code (732) 389-3890 _________________________________________________________________ (Former name, former address and former fiscal year, if changed since last report.) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ________ The number of shares outstanding of issuer's common stock as of November 11, 1999 was 7,270,895 shares. UNITED MOBILE HOMES, INC. for the QUARTER ENDED SEPTEMBER 30, 1999 PART I - FINANCIAL INFORMATION Page No. Item 1 - Financial Statements Consolidated Balance Sheets........................ 3 Consolidated Statements of Income.................. 4 Consolidated Statements of Cash Flows.............. 5 Notes to Consolidated Financial Statements......... 6-7 Item 2 - Management Discussion and Analysis of Financial Conditions and Results of Operations..... 8-9 Item 3 - Quantitative and Qualitative Disclosures About Market Risk There have been no material changes to information required regarding quantitative and qualitative disclosures about market risk from the end of the preceding year to the date of this Form 10-Q. PART II - OTHER INFORMATION.................................. 10 SIGNATURES......................................... 11 -2-
UNITED MOBILE HOMES, INC. CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 1999 and DECEMBER 31, 1998 September 30, December 31, 1999 1998 - -ASSETS- INVESTMENT PROPERTY AND EQUIPMENT Land $ 6,797,935 $ 6,797,935 Site and Land Improvements 46,778,829 46,198,257 Buildings and Improvements 2,694,864 2,691,426 Rental Homes and Accessories 7,600,547 5,656,441 ---------- ---------- Total Investment Property 63,872,175 61,344,059 Equipment and Vehicles 2,831,978 2,643,774 ---------- ---------- Total Investment Property and Equipment 66,704,153 63,987,833 Accumulated Depreciation (26,840,539) (25,091,588) ---------- ---------- Net Investment Property and Equipment 39,863,614 38,896,245 ---------- ---------- OTHER ASSETS Cash and Cash Equivalents 2,028,472 832,408 Securities Available for Sale 9,619,741 7,752,565 Notes and Other Receivables 1,127,309 734,724 Unamortized Financing Costs 262,292 157,928 Prepaid Expenses -0- 168,515 Land Development Costs 2,878,134 1,504,264 ---------- ---------- Total Other Assets 15,915,948 11,150,404 ---------- ---------- TOTAL ASSETS $55,779,562 $50,046,649 ========== ========== - - LIABILITIES AND SHAREHOLDERS' EQUITY - MORTGAGES PAYABLE $30,567,507 $21,411,576 ---------- ---------- OTHER LIABILITIES Accounts Payable 733,788 152,011 Loans Payable 81,240 3,368,512 Accrued Liabilities and Deposits 1,593,326 1,495,653 Tenant Security Deposits 465,728 406,084 ---------- ---------- Total Other Liabilities 2,874,082 5,422,260 ---------- ---------- TOTAL LIABILITIES 33,441,589 26,833,836 ---------- ---------- SHAREHOLDERS' EQUITY Common Stock - $.10 par value per share 10,000,000 shares authorized, 7,364,895 and 7,246,580 issued and 7,251,895 and 7,246,580 outstanding, respectively 740,772 724,658 Additional Paid-In Capital 24,862,189 23,427,783 Accumulated Other Comprehensive Loss (691,895) (271,835) Accumulated Deficit (1,464,358) (667,793) Treasury Stock, at cost (113,000 shares at September 30,1999) (1,108,735) -0- ---------- ---------- Total Shareholders' Equity 22,337,973 23,212,813 ---------- ---------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $55,779,562 $50,046,649 ========== ==========
-UNAUDITED- See Notes to Consolidated Financial Statements -3-
UNITED MOBILE HOMES, INC. CONSOLIDATED STATEMENTS OF INCOME For the THREE AND NINE MONTHS ended SEPTEMBER 30, 1999 and 1998 THREE MONTHS NINE MONTHS 9/30/99 9/30/98 9/30/99 9/30/98 Rental and Related Income $ 4,500,117 $ 4,225,218 $13,220,273 $12,523,728 Community Operating Expense 2,083,270 2,000,636 6,107,483 5,647,830 --------- --------- --------- --------- Income from Community Operations 2,416,847 2,224,582 7,112,790 6,875,898 General and Administrative 429,294 423,958 1,253,393 1,143,636 Interest Expense 496,413 377,608 1,335,886 1,131,737 Investment Income (254,874) (153,425) (639,445) (327,533) Depreciation 578,608 591,802 1,804,546 1,793,537 Other Expenses 26,860 29,895 67,510 71,865 -------- ------- --------- --------- Income before (Loss) Gains On Sales of Assets 1,140,546 954,744 3,290,900 3,062,656 (Loss)Gain on Sales of Assets (21,335) 687 (16,883) 10,615 --------- ------- --------- --------- Net Income $1,119,211 $955,431 $3,274,017 $3,073,271 ========= ======= ========= ========= Net Income Per Share - Basic $ .15 $ .13 $ .45 $ .44 ========= ======= ========= ========= Diluted $ .15 $ .13 $ .45 $ .44 ========= ======= ========= ========= Weighted Average Shares - Basic 7,262,601 7,156,058 7,237,903 6,991,239 ========= ========= ========= ========= Diluted 7,276,201 7,158,227 7,259,278 7,016,236 ========= ========= ========= =========
-UNAUDITED- See Notes to Consolidated Financial Statements -4-
UNITED MOBILE HOMES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS for the NINE MONTHS ended September 30, 1999 and 1998 1999 1998 CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 3,274,017 $ 3,073,271 Non-Cash Adjustments: Depreciation 1,804,546 1,793,537 Amortization 67,510 71,865 Gain on Sales of Securities Available for Sale (53,473) -0- (Loss) Gain of Sales of Investment Property and Equipment 16,883 (10,615) Changes in Operating Assets And Liabilities - Notes and Other Receivables (392,585) (226,258) Prepaid Expenses 168,515 109,415 Accounts Payable 581,777 (103,464) Accrued Liabilities and Deposits 97,673 122,687 Tenant Security Deposits 59,644 18,566 --------- ---------- Net Cash Provided by Operating Activities 5,624,507 4,849,004 --------- ---------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of Investment Property and Equipment (3,051,732) (1,211,312) Proceeds from Sales of Assets 262,934 152,978 Additions to Land Development (1,373,870) (1,994,818) Purchase of Securities Available for Sale (2,651,686) (2,356,357) Proceeds from Sales of Securities Available for Sale 417,923 -0- --------- --------- Net Cash Used by Investing Activities (6,396,431) (5,409,509) --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from Mortgages and Loans 10,500,000 3,600,000 Principal Payments of Mortgages and Loans (4,631,341) (2,623,723) Financing Costs on Debt (171,874) (83,774) Proceeds from Dividend Reinvestment And Stock Purchase Plan -0- 1,870,075 Proceeds from Exercise of Stock Options 263,750 165,000 Dividends Paid (2,883,812) (2,448,334) Purchase of Treasury Stock (1,108,735) -0- --------- --------- Net Cash Provided by Financing Activities 1,967,988 479,244 --------- --------- NET INCREASE IN CASH AND CASH EQUIVALENTS 1,196,064 (81,261) CASH & CASH EQUIVALENTS - BEGINNING 832,408 191,319 --------- ------- CASH & CASH EQUIVALENTS - ENDING $2,028,472 $110,058 ========= =======
-UNAUDITED- See Notes to Consolidated Financial Statements -5- UNITED MOBILE HOMES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 1999 (UNAUDITED) NOTE 1 - ACCOUNTING POLICY The interim consolidated financial statements furnished herein reflect all adjustments which were, in the opinion of management, necessary to present fairly the financial position, results of operations, and cash flows at September 30, 1999 and for all periods presented. All adjustments made in the interim period were of a normal recurring nature. Certain footnote disclosures which would substantially duplicate the disclosures contained in the audited consolidated financial statements and notes thereto included in the annual report of United Mobile Homes, Inc. (the Company) for the year ended December 31, 1998 have been omitted. NOTE 2 - NET INCOME PER SHARE AND COMPREHENSIVE INCOME Diluted net income per share is calculated by dividing net income by the weighted average number of common shares outstanding plus the weighted average number of net shares that would be issued upon exercise of stock options pursuant to the treasury stock method. Options in the amounts of 13,600 and 21,375 for the three and nine months ended September 30, 1999, respectively, and 2,169 and 24,997 for the three and nine months ended September 30, 1998, are included in the diluted weighted average shares outstanding. Total comprehensive income, including unrealized gains (losses) on securities available for sale, amounted to $539,364 and $2,853,957, for the three and nine months ended September 30, 1999, respectively, and $668,730 and $2,754,010 for the three and nine months ended September 30, 1998, respectively. NOTE 3 - MORTGAGES PAYABLE On February 10, 1999, the Company entered into a $4,000,000 mortgage payable to Summit Bank. The interest rate on this mortgage is fixed at 7.0%. This mortgage loan is due on March 1, 2004. Proceeds of this mortgage were used primarily to retire existing debt, purchase securities available for sale and purchase Treasury Stock. On July 28, 1999, the Company entered into a $4,000,000 mortgage and a $2,500,000 mortgage with First Union Bank. These mortgages bear interest at an effective rate of 7.86%. These mortgages mature on August 2, 2004. Proceeds from these mortgages were used primarily to retire existing debt, purchase securities available for sale and fund land development. -6- NOTE 4 - DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN On September 15, 1999, the Company paid $1,359,730 as a dividend of $.1875 per share to shareholders of record as of August 16, 1999. The total dividends paid for the nine months ended September 30, 1999 amounted to $4,070,582. On September 15, 1999, the Company received $374,498 from the Dividend Reinvestment and Stock Purchase Plan. There were 42,824 new shares issued resulting in 7,294,719 shares outstanding. The total amount received from the Dividend Reinvestment Plan for the nine months ended September 30, 1999 amounted to $1,186,770. NOTE 5 - TREASURY STOCK During the nine months ended September 30, 1999, the Company purchased 113,000 shares of its own stock for a total cost of $1,108,735. These shares are accounted for under the cost method and are included as Treasury Stock in the Consolidated Financial Statements. NOTE 6 - EMPLOYEE STOCK OPTIONS During the nine months ended September 30, 1999, the following stock options were granted: Date of Number of Number of Option Expiration Grant Employees Shares Price Date 1/5/99 1 25,000 $11.5625 1/5/2004 9/28/99 8 36,000 $ 8.8125 9/28/2004 During the nine months ended September 30, 1999, two employees exercised their stock options and purchased 30,000 shares for total proceeds of $263,750. As of September 30, 1999, there were options outstanding to purchase 415,500 shares and 272,500 shares available for grant under the Company's Stock Option Plans. NOTE 7 - SUPPLEMENTAL CASH FLOW INFORMATION Cash paid during the nine months ended September 30, 1999 and 1998 for interest was $1,335,886 and $1,239,937, respectively. During the nine months ended September 30, 1999 and 1998, land development costs of $-0- and $250,000, respectively, were transferred to investment property and equipment and placed in service. During the nine months ended September 30, 1999 and 1998, the Company had dividend reinvestments of $1,186,770 and $1,406,650, respectively, which required no cash transfers. -7- MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS MATERIAL CHANGES IN FINANCIAL CONDITION United Mobile Homes, Inc. (the Company) owns and operates twenty- four manufactured home communities. These manufactured home communities have been generating increased gross revenues and increased operating income. The Company generated $5,624,507 net cash provided by operating activities. The Company received new capital of $1,186,770 through its Dividend Reinvestment and Stock Purchase Plan (DRIP). The Company repurchased 113,000 shares of its own stock at a cost of $1,108,735. The Company purchased $2,651,686 of Securities Available for Sale. Mortgages Payable increased by $9,155,931 as a result of new mortgages of $10,500,000 offset by principal repayments. Loans payable decreased by $3,287,272 primarily as a result of repayments. MATERIAL CHANGES IN RESULTS OF OPERATIONS Income from community operations increased by $192,265 to $2,416,847 for the quarter ended September 30, 1999 as compared to $2,224,582 for the quarter ended September 30, 1998. Income from community operations increased by $236,892 to $7,112,790 for the nine months ended September 30, 1999 as compared to $6,875,898 for the nine months ended September 30, 1998. This represents a continuing trend of rising income from community operations. The Company has been raising rental rates by approximately 4 to 5% annually. Rental and related income rose from $4,225,218 for the quarter ended September 30, 1998 to $4,500,117 for the quarter ended September 30, 1999. Rental and related income rose from $12,523,728 for the nine months ended September 30, 1998 to $13,220,273 for the nine months ended September 30, 1999. This was the result of higher rents. Community operating expenses increased from $2,000,636 for the quarter ended September 30, 1998 to $2,083,270 for the quarter ended September 30, 1999. Community operating expenses increased from $5,647,830 for the nine months ended September 30, 1998 to $6,107,483 for the nine months ended September 30, 1999. Community operating expenses increased due to an increase in certain expenses associated with filling vacant expansion sites (i.e. advertising, personnel, etc.). General and administrative expenses remained relatively stable for the quarter ended September 30, 1999 compared to the quarter ended September 30, 1998. General and Administrative expenses increased from $1,143,636 for the nine months ended September 30, 1998 to $1,253,393 for the nine months ended September 30, 1999. This was primarily due to an increase in personnel. Interest expense increased by $118,805 for the quarter ended September 30, 1999 compared to the quarter ended September 30, 1998 and by $204,149 for the nine months ended September 30, 1999 compared to the nine months ended September 30, 1998. This was primarily a result of an increase in the average principal balance on borrowings outstanding. The balance outstanding of mortgages payable at September 30, 1999 was $30,567,507 as compared to $21,548,840 at September 30, 1998. -8- Funds from operations (FFO), defined as net income, excluding gains (or losses) from sales of depreciable assets, plus depreciation amounted to $1,719,154 for the quarter ended September 30, 1999 and $1,546,546 for the quarter ended September 30, 1998. FFO amounted to $5,095,446 for the nine months ended September 30, 1999 and $4,856,193 for the nine months ended September 30, 1998. FFO does not replace net income (determined in accordance with generally accepted accounting principles) as a measure of performance or net cash flows as a measure of liquidity. FFO should be considered as a supplemental measure of operating performance used by real estate investment trusts. LIQUIDITY AND CAPITAL RESOURCES Net cash provided by operating activities increased from $4,849,004 for the nine months ended September 30, 1998 to $5,624,507 for the nine months ended September 30, 1999. The Company believes that funds generated from operations together with the financing and refinancing of its properties will be sufficient to meet its needs over the next several years. YEAR 2000 The Company is currently in the process of completing its Year 2000 compliance plan. The Company has assessed all hardware and software for Year 2000 readiness. The Company has substantially completed its renovation and testing plans, including hardware replacement and software upgrades, to ensure all hardware and software is year 2000 compliant. The Company has no significant suppliers and vendors. The Company has developed contingency plans for each of its critical systems, which includes moving many of the Company's operations to a manual system. There can be no assurances given that the Year 2000 compliance plan will be completed successfully by the Year 2000, in which event the Company could incur additional costs to implement its contingency plans. Management does not anticipate that such costs would be significant to the Company. The total costs associated with the Company's Year 2000 plan are anticipated to be less than $20,000. Successful and timely completion of the Year 2000 plan is based on management's best estimates derived from various assumptions of future events, which are inherently uncertain, including the effectiveness of remediation and validation plans, and all vendors and suppliers readiness. -9- PART II OTHER INFORMATION Item 1 - Legal Proceedings - none Item 2 - Changes in Securities - none Item 3 - Defaults Upon Senior Securities - none Item 4 - Submission of Matters to a Vote of Security Holders - none Item 5 - Other Information - none Item 6 - Exhibits and Reports on Form 8-K - (a) Exhibits - none (b) Reports on Form 8-K - none -10- SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. DATE: November 11, 1999 By: /s/Samuel A. Landy Samuel A. Landy, President DATE: November 11, 1999 By: /s/Anna T. Chew Anna T. Chew, Vice President and Chief Financial Officer EX-27 2
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF UNITED MOBILE HOMES, INC. AS OF AND FOR THE PERIOD ENDED ENDED SEPTEMBER 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 9-MOS DEC-31-1999 SEP-30-1999 2,028,472 9,619,741 1,229,507 102,198 0 12,775,522 66,704,153 26,840,539 55,779,562 2,874,082 30,567,507 0 0 740,772 21,597,201 55,779,562 0 13,842,835 0 6,107,483 3,125,449 0 1,335,886 3,274,017 0 3,274,017 0 0 0 3,274,017 .45 .45
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