-----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, ARfAVUIk3xNIHhnMBFti3/h3O+1j1eQdityMCV5poODifvfZlfkiEUKkl5f248rC JesZsyrdetH7VwMDK7FrCA== 0000798359-96-000017.txt : 19961001 0000798359-96-000017.hdr.sgml : 19961001 ACCESSION NUMBER: 0000798359-96-000017 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960731 FILED AS OF DATE: 19960930 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: INVESTORS REAL ESTATE TRUST CENTRAL INDEX KEY: 0000798359 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 450311232 STATE OF INCORPORATION: ND FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-14851 FILM NUMBER: 96636669 BUSINESS ADDRESS: STREET 1: 12 S MAIN CITY: MINOT STATE: ND ZIP: 58701 BUSINESS PHONE: 7018521756 MAIL ADDRESS: STREET 1: 12 S MAIN CITY: MINOT STATE: ND ZIP: 58701 10-Q/A 1 Form 10-Q/A SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended July 31, 1996 Commission file number 0-14851 INVESTORS REAL ESTATE TRUST (Exact name of registrant as specified in its charter) North Dakota 45-0311232 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 12 South Main, Minot, ND 58701 (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code:(701)852-1756 (Former name, former address and former fiscal year, if changed since last report.) No change 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 ( ) Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Applicant is a Business Trust. As of July 31, 1996, it had 13,666,570 Shares of Beneficial Interest outstanding. PART I Item 1. Financial Statements. The following financial statements have been prepared from the records of Investors Real Estate Trust and its six affiliated limited partnerships and have not been audited or reviewed by the Trust's independent certified public accountants. Accordingly, these statements are subject to adjustments upon audit, which audit will be conducted for the Fiscal Year ending April 30, 1997. Reference is made to the footnotes to the Statements prepared by the Trust's auditors for the Fiscal Year ended April 30, 1996, contained in the Annual Report for Fiscal 1996. In the opinion of the Trust, there have been no developments requiring footnote disclosure for the periods covered by the Financial Statements set forth below that are not adequately disclosed in the footnotes to the April 30, 1996, statements. BALANCE SHEETS For the Periods Ended July 31, 1996 & 1995 (unaudited)
ASSETS: 07-31-96 07-31-95 Cash $ 2,337,764 $ 1,442,979 Marketable Securities -GNMA's 4,203,355 4,712,181 -Other REIT's 603,119 0 Tax & Insurance Escrow 1,529,646 906,502 Deferred Charges 1,041,141 225,787 Prepaid Insurance 99,962 76,787 Deposits 70,000 25,000 General Partnerships 85,576 0 $ 9,970,563 $ 7,389,236 Real Estate Investments Real Estate Owned $137,118,745 $112,423,263 Less Accumulated Deprec. (14,043,454) (13,580,483) Net Real Estate Owned 123,075,291 98,842,780 Real Estate Mortgages (related) 0 117,692 Real Estate Mortgages (unrelated) 3,282,698 3,651,972 Less Unearned Discounts (18,222) (34,792) Less Deferred Gain from Property Dispositions (165,074) (219,861) Less Reserve for Bad Debts (197,096) (267,096) Net Mortgages & Contracts 2,902,306 3,247,915 Total Real Estate Investments $125,977,597 $102,090,695 TOTAL ASSETS $135,948,160 $109,479,931 LIABILITIES: Accounts Payable & Other Liabilities $ 1,900,295 $ 4,890,340 Mortgages Payable 74,106,387 58,305,787 Investment Certificates Payable 6,718,161 5,166,884 Due on Margin Account 0 0 TOTAL LIABILITIES $82,724,843 $68,363,011 SHAREHOLDERS' EQUITY Shares of Beneficial Interest Outstanding Shares of 07-31-96 07-31-95 13,666,570 as of 07/31/96 11,697,025 as of 07/31/95 $ 56,853,298 $ 44,633,712 Undistributed Net Income (3,629,981) (3,516,792) Total Shareholders' Equity $ 53,223,317 $ 41,116,920 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $135,948,160 $109,479,931
STATEMENT OF OPERATIONS For the Three-Month Periods Ended July 31, 1996 & 1995 (unaudited)
3 Months Ended July 31 OPERATING INCOME: 1996 1995 Real Estate Rentals $4,750,394 $3,542,483 Interest Income 214,648 215,178 Mortgage Discount & Fees 1,433 24,400 $4,966,475 $3,782,061 OPERATING EXPENSE: Interest $1,421,183 $1,116,188 Utilities & Maintenance 774,431 495,287 Property Management 377,718 163,863 Taxes & Insurance 552,750 371,562 Advisory & Trustees Fees 129,217 98,183 Operating Expenses 42,709 31,510 $3,298,008 $2,276,593 OPERATING INCOME (before reserves): $1,668,467 $1,505,468 DEPRECIATION/AMORTIZATION (690,360) (496,000) OPERATING INCOME (after reserves): $ 978,107 $1,009,468 GAIN ON SALE OF INVESTMENTS 254,929 0 NET INCOME $1,233,036 $1,009,468 NET INCOME PER SHARE: Operating Income (after depreciation) .07 .09 Gain on Sale of Investments .02 0 Total Net Income/Share .09 .09 DIVIDENDS PAID PER SHARE .0975 .0925 Average Number of Shares Outstanding 13,559,802 11,500,787
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE-MONTH PERIODS ENDED JULY 31, 1996, AND 1995 (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES 1996 1995 Net Income $ 1,233,036 $ 1,009,469 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 690,361 496,000 Interest reinvested in investment certificates 18,885 14,375 Changes in other assets and liabilities: (Increase) decrease in other assets (257,068) (564,305) Increase in accounts payable and accrued expenses 637,650 431,283 NET CASH PROVIDED FROM OPERATING ACTIVITIES $ 2,322,864 $ 1,386,822 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of REIT stock $ (600,000)$ 0 Proceeds from sale of securities 208,502 120,415 Principal payments on mortgage loans receivable 706,091 1,305,458 Payments for acquisition of properties (6,154,468) (20,443,742) Investment in mortgage loans receivable (324,780) (68,395) NET CASH PROVIDED FROM (USED FOR) INVESTING ACTIVITIES $ (6,164,655)$(19,086,264) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from loan refinance $ 3,900,000 $ 8,657,569 Proceeds from sale of shares 1,701,643 2,618,862 Dividends paid (473,903) (408,420) Proceeds from investment certificates issued 769,668 212,863 Loan on margin account 0 3,773,437 Redemption of investment certificates (132,961) (142,293) Principal payments on mortgage loans and notes payable (1,545,869) (342,339) Payments on margin account 0 0 NET CASH USED FOR FINANCING ACTIVITIES $ 4,218,578 $ 14,369,679 NET INCREASE (DECREASE) IN CASH $ (376,787) $(3,329,763) CASH AT APRIL 30 $ 2,714,552 $ 4,772,742 CASH AT JULY 31 $ 2,337,764 $ 1,442,979
SUPPLEMENTARY SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES 1996 1995 Dividends reinvested $ 839,350 $ 655,347 Real estate investment and mortgage loans receivable acquired through borrowings on margin account and new originations 0 8,657,569 Mortgages paid directly by owner of contract 0 0 Interest reinvested directly in investment certificates 18,885 14,375 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Cash paid during the year for: Interest paid on mortgages $ 1,478,051 $ 1,043,164 Interest paid on margin account and other 0 0 Interest paid on investment certificates 32,815 30,477 $ 2,369,101 $10,400,932
(The balance of this page was left blank intentionally.) Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. Results of Operations. IRET had net earnings for its first quarter of Fiscal 1997 of $1,233,036, compared to $1,009,468 for the same period of the prior fiscal year, an increase of 22%. This year's first quarter earnings include $254,929 of capital gain income. No capital gain income was recognized in the first quarter of the prior year. Funds from operations (taxable income increased by non-cash deductions of depreciation and amortization, less extraordinary income items) increased to $1,670,748 from the year earlier figure of $1,505,468, an increase of 11%. Operating results were negatively impacted by the continued vacancy of the large retail building in Boise, Idaho, formerly occupied by Smith Home Furnishings. Lost rent on this property is approximately $50,000 per month and we continue to seek a new tenant for this property. Otherwise, our portfolio continues to perform satisfactorily. Rental income for the first quarter rose to $4,750,394 from $3,542,483 received in the prior year, and we project rapidly increasing rental income as IRET expands its investment portfolio. We are particularly pleased with the performance of our newly acquired investments. Financial Condition. IRET's liquidity and capital resources remain strong and reflect the rapid growth experienced over the past year. This growth continues as the Trust has purchased a substantial amount of real estate investments which will come on line during the balance of this fiscal year. Comparative balance sheet figures are: 07/31/96 07/31/95 Cash and Marketable Securities $ 7,144,238 $ 6,155,160 Net Real Estate Owned 123,075,291 98,842,780 Net Real Estate Mortgages 2,902,306 3,247,915 Total Assets 135,948,160 109,479,931 Total Liabilities 82,724,842 68,363,011 Shareholder Equity 53,223,317 41,116,920
Consolidated Financial Reports. The Financial Statements shown in this report consolidate IRET's financial report with those of the six limited partnerships of which IRET is the General Partner and creditor. Sale of Properties. During the first quarter, IRET sold the 24 unit apartment building in Hutchinson, Minnesota, for $500,000, recognizing a capital gain of $254,929. The following apartment complexes were added to our portfolio during the first quarter and are producing income: Cost - 60 unit Rosewood Apartment complex in Sioux Falls, SD $ 1,900,000 - 98 unit South Pointe - Phase II apartment complex, Minot, ND $ 5,180,008 The following properties are under construction: - 98 unit apartment complex in Billings, MT $ 5,500,000 - 49 unit Circle 50 apartment complex in Billings, MT $ 2,600,000 - 67 unit Legacy Apartment complex in Grand Forks, ND $ 5,400,000 - Sweetwater Springs Retirement Home, Douglasville, GA $ 4,350,000 IRET has entered into purchase agreements to acquire the following properties: - 360 unit Park Meadows apartment complex, St. Cloud, MN $10,120,000 - 192 unit Neighborhood apartment complex, Colorado Springs, CO $10,750,000 - 210 unit Miramont apartment complex, Fort Collins, CO $14,200,000 - 108 unit Woodridge apartment complex, Rochester, MN $ 6,300,000 - 16,000 sq. ft. Computer City retail commercial building, Grand Rapids, MI $ 2,100,000 Dividends. IRET paid a regular dividend of 9.25 cents, plus a special dividend of .5 cents, for a total dividend of 9.75 cents per share on July 1, 1996, to shareholders of record at the close of business on June 21, 1996. This was an increase from the 9.125 cents per share dividend paid on April 1, 1996, and was the 101st consecutive quarterly dividend paid by IRET. 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. None Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. INVESTORS REAL ESTATE TRUST (Registrant) /s/ Thomas A. Wentz, Sr. Date: September 25, 1996 By______________________________ Thomas A. Wentz, Sr., Vice-President EX-27 2
5 3-MOS APR-30-1997 JUL-31-1996 2,337,764 4,803,355 3,282,698 (380,392) 0 2,826,325 137,118,745 (14,043,454) 135,945,041 76,006,682 6,718,160 56,853,298 0 0 (3,633,099) 135,945,041 0 4,966,475 0 2,567,185 0 0 1,421,183 978,107 0 978,107 254,929 0 0 1,233,036 .09 0
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