Comstock Holding Companies Reports Third Quarter 2020 Results

Rhea-AI Summary

Comstock Holding Companies (NASDAQ: CHCI) reported third quarter 2020 results, revealing a net income of $0.4 million, up from a net loss of $0.6 million in Q3 2019. Total revenue rose 29% to $7.3 million, driven by a 24% increase in asset management revenue ($5.9 million) and a 52% increase in real estate services revenue ($1.4 million). For the nine months ended September 30, 2020, net income was $1.6 million, compared to a net loss of $0.8 million in the prior year, with total revenue climbing 31% to $20.8 million. Operating income surged 185% in Q3 2020 to $0.5 million.

Positive

• Net income increased to $0.4 million in Q3 2020, compared to a loss of $0.6 million in Q3 2019.
• Total revenue rose by 29% to $7.3 million compared to Q3 2019.
• Revenue from asset management operations increased by 24% to $5.9 million.
• Revenue from real estate services surged by 52% to $1.4 million.
• Operating income increased by 185% to $0.5 million in Q3 2020.
• For nine months ended September 30, 2020, net income reached $1.6 million vs. a loss of $0.8 million in the prior year.
• Total revenue for the nine months was up 31% to $20.8 million.
• Revenue from asset management increased by 16% to $15.5 million.
• Revenue from real estate services increased by 106% to $5.3 million.
• Operating income for nine months increased by 230% to $2.0 million.

Negative

• None.

WASHINGTON and RESTON, Va., Nov. 16, 2020 (GLOBE NEWSWIRE) -- On November 16, 2020, Comstock Holding Companies, Inc., (NASDAQ: CHCI) (the “Company”), announced results for the three and nine months ended September 30, 2020:

Highlights of Third Quarter 2020, as compared to Third Quarter 2019:

• Net income increased to $0.4 million during the third quarter 2020, as compared to a net loss of $0.6 million during the same period of the prior year.
• Total revenue increased by 29% to $7.3 million during the third quarter 2020, as compared to $5.7 million during the same period of the prior year.
• Revenue from asset management operations increased by 24% to $5.9 million during the third quarter 2020, as compared to $4.7 million during the same period of the prior year.
• Revenue from real estate services increased by 52% to $1.4 million during the third quarter 2020, compared to $0.9 million during the same period of the prior year.
• Operating income increased by 185% to $0.5 million during the third quarter 2020, as compared to $0.2 million during the same period of the prior year.

Highlights of nine months ended September 30, 2020, as compared to nine months ended September 30, 2019:

• Net income increased to $1.6 million during the nine months ended September 30, 2020, as compared to a net loss of $0.8 million during the same period of the prior year.
• Total revenue increased by 31% to $20.8 million during the nine months ended September 30, 2020, as compared to $15.9 million during the same period of the prior year.
• Revenue from asset management operations increased by 16% to $15.5 million during the nine months ended September 30, 2020, as compared to $13.3 million during the same period of the prior year.
• Revenue from real estate services increased by 106% to $5.3 million during the nine months ended September 30, 2020, as compared to $2.6 million during the same period of the prior year.
• Operating income increased by 230% to $2.0 million during the nine months ended September 30, 2020, as compared to $0.6 million during the same period of the prior year.

“The growth of Comstock’s top and bottom lines so far this year is the result of the financial stability provided by our long-term asset management agreements, the quality of, and demand for, the properties we develop and manage, and the dedication of our team of commercial real estate professionals” said Chris Clemente, Chairman and CEO of Comstock Holding Companies Inc. “We continue to focus on executing our strategic plan that’s designed to continue expanding assets under management through acquisitions and through the thoughtful development of our mixed-use and transit-oriented pipeline in one of the best real estate markets in the nation. I look forward to reporting on our continued progress in future quarters.”

About Comstock Holding Companies, Inc.

Comstock Holding Companies, Inc. (“Comstock” or “CHCI”) is a leading real estate developer, investor, asset manager and real estate related service provider that has designed, developed, constructed and managed several thousand residential units and millions of square feet of mixed-use projects since 1985. The Company has been selected by multiple local governments to be master developer of municipally owned properties redeveloped through public-private partnerships.  CHCI’s managed portfolio includes two of the largest transit-oriented, mixed-use developments in the Washington, D.C. area; Reston Station, a 5+ million square foot transit-oriented and mixed-use development in Reston, Virginia, and Loudoun Station, a nearly 2.5 million square foot transit-oriented, mixed-use development in Ashburn, Virginia, and additional development and stabilized assets. Comstock also acquires and operates stabilized real estate assets in partnership with institutional investors. 

Comstock Holding Companies, Inc. is publicly traded on NASDAQ under the symbol CHCI. For more information, visit www.ComstockCompanies.com.

Cautionary Statement Regarding Forward-Looking Statements

This release may include "forward-looking" statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by use of words such as "anticipate," "believe," "estimate," "may," "intend," "expect," "will," "should," "seeks" or other similar expressions. Forward-looking statements are based largely on our expectations and involve inherent risks and uncertainties, many of which are beyond our control. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements. Additional information concerning important risk factors and uncertainties can be found under the heading "Risk Factors" in our latest Annual Report on Form 10-K, as filed with the Securities and Exchange Commission. Comstock specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.

Company:
Comstock Holding Companies, Inc.
Christopher Guthrie, 703-230-1292
Chief Financial Officer

Source: Comstock Holding Companies, Inc.

COMSTOCK HOLDING COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share data)

	September 30, 2020				December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	4,491			$	3,511
Trade receivables	1,635				1,886
Trade receivables - related parties	3,016				3,644
Prepaid and other assets, net	240				274
Total current assets	9,382				9,315
Equity method investments at fair value	6,965				8,421
Fixed assets, net	266				278
Goodwill	1,702				1,702
Intangible assets, net	53				103
Operating lease right-of-use assets	—				114
TOTAL ASSETS	$	18,368			$	19,933
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accrued personnel costs	$	1,349			$	2,916
Accounts payable	307				1,438
Accrued liabilities	660				166
Short term notes payable - due to affiliates, net of discount	—				5,706
Short term notes payable	22				77
Total current liabilities	2,338				10,303
Long term notes payable - due to affiliates	5,500				—
Long term notes payable - net of deferred financing charges	—				1,212
Long term operating lease liabilities, net of current portion	—				61
TOTAL LIABILITIES	$	7,838			$	11,576
Commitments and contingencies
STOCKHOLDERS’ EQUITY
Series C preferred stock $0.01 par value, 20,000,000 shares authorized, 3,440,690 issued and outstanding and liquidation preference of $17,203 at September 30, 2020 and December 31, 2019	$	6,765			$	6,765
Class A common stock, $0.01 par value, 59,779,750 shares authorized, 7,949,152 and 7,849,756 issued, and 7,863,582 and 7,764,186 outstanding at September 30, 2020 and December 31, 2019, respectively	79				78
Class B common stock, $0.01 par value, 220,250 shares authorized, issued and outstanding at September 30, 2020 and December 31, 2019	2				2
Additional paid-in capital	199,953				199,372
Treasury stock, at cost (85,570 shares Class A common stock)	(2,662		)		(2,662		)
Accumulated deficit	(193,607		)		(195,198		)
TOTAL COMSTOCK HOLDING COMPANIES, INC. EQUITY	$	10,530			$	8,357
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	18,368			$	19,933

COMSTOCK HOLDING COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)

	Three Months Ended September 30,								Nine Months Ended September 30,
	2020				2019				2020				2019
Revenues
Revenue—asset management	$	5,891			$	4,733			$	15,466			$	13,326
Revenue—real estate services	1,439				947				5,294				2,573
Total revenue	7,330				5,680				20,760				15,899
Expenses
Direct costs - asset management	5,066				4,197				12,915				11,804
Direct costs - real estate services	630				862				3,109				2,265
General and administrative	1,029				353				2,261				968
Selling and Marketing	127				100				507				266
Operating income	478				168				1,968				596
Other income, net	55				47				92				131
Interest expense	(63		)		(170		)		(320		)		(304		)
Income before income tax expense	470				45				1,740				423
Income tax expense	(1		)		—				(15		)		—
Loss on equity method investments carried at fair value	(46		)		(606		)		(134		)		(606		)
Net income (loss) from continuing operations	423				(561		)		1,591				(183		)
Net loss from discontinued operations, net of tax	—				(66		)		—				(596		)
Net income (loss)	$	423			$	(627	)		$	1,591			$	(779	)
Income (loss) per share from continuing operations
Basic net income (loss) per share	$	0.05			$	(0.07	)		$	0.20			$	(0.03	)
Diluted net income (loss) per share	$	0.05			$	(0.07	)		$	0.19			$	(0.03	)
Loss per share from discontinued operations
Basic net loss per share	$	—			$	(0.01	)		$	—			$	(0.10	)
Diluted net loss per share	$	—			$	(0.01	)		$	—			$	(0.10	)
Basic weighted average shares outstanding	8,078				7,954				8,046				6,159
Diluted weighted average shares outstanding (continuing operations)	8,579				7,954				8,415				6,159
Diluted weighted average shares outstanding (discontinued operations)	—				7,954				—				6,159

FAQ

What were the key financial highlights for Comstock Holding Companies (CHCI) in Q3 2020?

In Q3 2020, Comstock reported a net income of $0.4 million, a total revenue increase of 29% to $7.3 million, and an operating income surge of 185% to $0.5 million.

How did Comstock Holding Companies (CHCI) perform in the nine months ended September 30, 2020?

For the nine months ended September 30, 2020, Comstock achieved a net income of $1.6 million and a total revenue increase of 31% to $20.8 million.

What growth did Comstock Holding Companies (CHCI) see in its revenue streams for Q3 2020?

Comstock experienced a 24% growth in asset management revenue to $5.9 million and a 52% increase in real estate services revenue to $1.4 million in Q3 2020.

What does Chris Clemente, CEO of Comstock Holding Companies (CHCI), say about the company's growth?

Chris Clemente highlighted growth in top and bottom lines due to financial stability from asset management agreements and a strong demand for their properties.