Comstock Homebuilding Companies, Inc.
Comstock Holding Companies, Inc. (Form: 8-K, Received: 04/07/2016 17:03:47)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act Of 1934

Date of Report (Date of earliest event reported): April 7, 2016 (April 1, 2016)

 

 

Comstock Holding Companies, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Delaware   1-32375   20-1164345

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

1886 METRO CENTER DR, FOURTH FLOOR

RESTON, VIRGINIA 20190

(Address of principal executive offices) (Zip Code)

Registrant’s Telephone Number, Including Area Code: (703) 883-1700

(Former Name or Former Address, if Changed Since Last Report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( See General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02 Results of Operations and Financial Condition.

On April 1, 2016, Comstock Holding Companies, Inc. (the “Company”) issued a press release announcing its results for the year ended December 31, 2015 and provided preliminary highlights for the first quarter ended March 31, 2016. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

 

99.1    Press Release by Comstock Holding Companies, Inc. dated April 1, 2016.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: April 7, 2016

 

COMSTOCK HOLDING COMPANIES, INC.
By:  

/s/ Christopher Clemente

 

Christopher Clemente,

Chief Executive Officer

Exhibit 99.1

Comstock Holding Companies Announces 2015 Results and Provides Preliminary Highlights for First Quarter 2016

WASHINGTON & RESTON, Va.—(BUSINESS WIRE)—

Comstock Holding Companies, Inc., (NASDAQ: CHCI), today announced financial results for the year ended December 31, 2015 and provided an update on first quarter 2016 performance:

Highlights of Fourth Quarter of 2015

 

    Fourth Quarter Revenue Up 166% to $26.2 Million from $9.8 Million in 4Q14

 

    Fourth Quarter Unit Deliveries Up 165% to 53 from 20 in Same Period 2014

 

    Fourth Quarter net income attributable to Comstock of $1.0 million before accounting for 2015 impairments of $2.8 million.

Highlights of 2015

 

    2015 Revenue Up 28% to $61.4 Million from $48.0 Million in 2014

 

    2015 Unit Deliveries Up 21% to 123 from 102 in 2014

 

    Net loss of $(4.6) million or $(1.43) per diluted share in 2015 compared to net loss of $(6.8) million or $(2.27) per diluted share in 2014

 

    2015 results reflect an impairment charge of $(2.8) million or $(0.86) per diluted share

 

    Backlog at year-end 2015 of 25 units valued at $10.8 million, compared to 24 units valued at $12.4 million at year-end 2014;

The Company filed a Form 12b-25 Notification of Late Filing with the U.S. Securities and Exchange Commission on March 31, 2016 with regard to its Form 10-K for the year ended December 31, 2015. The Company needed additional time to complete the accounting associated with the Company’s conversion of Stonehenge debt to preferred equity and most recent private offering, Comstock Growth Fund II. The Company expects that it will complete the subject work in time for the Company to file its Form 10-K for the fiscal year ended December 31, 2015 within the fifteen-day extension provided by Rule 12b-25 of the Exchange Act.

2016 1 st quarter preliminary highlights:

On a preliminary basis, the Company indicated performance metrics as set forth below during the first quarter of 2016. Note that the preliminary financial results, other than the historical results referenced below, are subject to completion of Comstock’s financial and accounting closing and review procedures.

 

    Homebuilding revenue in the first quarter of 2016 of $9.5 million compared to approximately $10.0 million in the same period of 2015,

 

    Unit deliveries in the first quarter of 2016 of 22, compared to 21 unit deliveries in the same period of 2015,


    Backlog at March 31, 2016 of 38 units valued at approximately $16.3 million, all of which is expected to be delivered in 2016, compared to 27 units valued at $14.3 million at March 31, 2015.

Business Commentary

Chairman and CEO Christopher Clemente commented: “Significant operational enhancements and changes to our product offerings implemented over the 18 months helped make the fourth quarter of 2015 our most productive quarter in several years. Cost reductions resulting from several operational changes will contribute to general and administrative reductions in 2016. We are confident that our reduced fixed operating costs coupled with what appears to be improving conditions in our core market of Washington, DC will contribute positively to our effort to restore the Company to profitability.”

 

     Year Ended December 31,  
     2015      2014  

Revenues

     

Revenue—homebuilding

   $ 60,132       $ 47,378   

Revenue—other

     1,244         587   
  

 

 

    

 

 

 

Total revenue

     61,376         47,965   

Operating loss

     (3,556      (2,976

Net loss

     (1,963      (3,114

Net income attributable to non-controlling interests

     2,604         3,725   
  

 

 

    

 

 

 

Net loss attributable to Comstock Holding Companies, Inc.

   $ (4,567    $ (6,839
  

 

 

    

 

 

 

Basic and diluted net loss per share

   $ (1.43    $ (2.27

Supplemental data

     

Unit deliveries

     123         102   

Backlog units

     25         24   

Backlog revenue

   $ 10,785       $ 12,430   

Controlled communities (1)

     17         19   

Open communities

     10         7   

Pipeline units under control (1)

     526         946   

 

(1) Includes communities and units under land option purchase contract, not owned.

COMSTOCK COMMUNITIES NOW OPEN

 

    Townes at Falls Grove (Manassas, VA, Prince William County) - townhome style condominiums priced from the high $200s

 

    Townes at Shady Grove (Rockville, MD, Montgomery County) - townhomes, adjacent to the Metro, priced from the low $600s


    Townes at Maxwell Square (Frederick, MD, Frederick County) - townhomes in historic downtown Frederick priced from the high $300s

 

    Townes at Hallcrest (Sterling, VA, Loudoun County) - townhomes priced from the mid $400s

 

    Estates at Falls Grove (Manassas, VA, Prince William County) - single-family homes priced from the high $400s

 

    Estates at Leeland (Fredericksburg, VA, Stafford County) - single-family homes priced from the mid $300s

 

    The Villas at Two Rivers I (Odenton, MD, Anne Arundel County) - villas priced from the low $400s

 

    The Villas at Two Rivers II (Odenton, MD, Anne Arundel County) - villas priced from the low $400s

COMSTOCK COMMUNITIES COMING SOON

 

    Marrwood East (Loudoun County, VA) - single-family homes priced from the $600s with sales activity beginning in February 2016

 

    Townes at Shady Grove – Phase II (Rockville, MD, Montgomery County) — townhomes, adjacent to the Metro, priced from the low $600s

 

    The Estates at Popkins Lane (Alexandria, VA) - single-family homes priced from the mid $800s with construction activity beginning in late 2016 and sales activity beginning in winter of 2017

 

    Townes at Totten Mews (Washington, DC) – townhomes priced from the high $500s with construction and sales activity beginning in mid 2016.

 

    The Townes at Richmond Station (Manassas, VA) – townhomes priced from the $300s with construction activity beginning in late 2017 and sales activity in early 2018.

 

    Condos at Richmond Station (Manassas, VA) – condominiums priced from the high $200s with construction activity beginning in late 2017 and sales activity in early 2018.

About Comstock Holding Companies, Inc.

Comstock is a homebuilding and multi-faceted real estate development and services company that builds a wide range of housing products under its Comstock Homes brand through its wholly owned subsidiary, Comstock Homes of Washington, LC. Our track record of developing numerous successful new home communities and nearly 6,000 homes, together with our substantial experience in building a diverse range of products including apartments, single-family homes, townhomes, mid-rise condominiums, high-rise condominiums and mixed-use (residential and commercial) developments has positioned Comstock as a leading developer and homebuilder in the Washington, D.C. metropolitan area. Comstock is a publicly traded company, trading on NASDAQ under the symbol CHCI. For more information about Comstock or its new home communities, please visit www.comstockhomes.com.


Cautionary Statement Regarding Forward-Looking Statements

This release includes “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 the 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. You should not place undue reliance on any forward-looking statement, which speaks only as of the date made. Some factors which may affect the accuracy of the forward-looking statements apply generally to the real estate industry, while other factors apply directly to us. Any number of important factors which could cause actual results to differ materially from those in the forward-looking statements include, without limitation: completion of Comstock’s financial accounting and review procedures; general economic and market conditions, including interest rate levels; our ability to service our debt; inherent risks in investment in real estate; our ability to compete in the markets in which we operate; economic risks in the markets in which we operate, including actions related to government spending; delays in governmental approvals and/or land development activity at our projects; regulatory actions; fluctuations in operating results; our anticipated growth strategies; shortages and increased costs of labor or building materials; the availability and cost of land in desirable areas; adverse weather conditions or natural disasters; our ability to raise debt and equity capital and grow our operations on a profitable basis; and our continuing relationships with affiliates. Additional information concerning these and other important risk and uncertainties can be found under the heading “Risk Factors” in our Annual Report on Form 10-K, as filed with the Securities and Exchange Commission, for the fiscal year ended December 31, 2014. Our actual results could differ materially from these projected or suggested by the forward-looking statements. Comstock claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 for all forward-looking statements contained herein. Comstock specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.


COMSTOCK HOLDING COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share and per share data)

 

     December 31,     December 31,  
     2015     2014  

ASSETS

    

Cash and cash equivalents

   $ 12,448      $ 7,498   

Restricted cash

     2,566        1,779   

Trade receivables

     332        110   

Real estate inventories

     38,223        40,889   

Fixed assets, net

     394        395   

Other assets

     4,515        5,696   
  

 

 

   

 

 

 

TOTAL ASSETS

   $ 58,478      $ 56,367   
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Accounts payable and accrued liabilities

   $ 7,638      $ 8,538   

Notes payable - secured by real estate inventories

     24,823        28,379   

Notes payable - due to affiliates, unsecured, net of discount

     19,028        15,488   

Notes payable - unsecured

     1,548        2,064   

Income taxes payable

     —          43   
  

 

 

   

 

 

 

TOTAL LIABILITIES

     53,037        54,512   
  

 

 

   

 

 

 

Commitments and contingencies

     —          —     

STOCKHOLDERS’ EQUITY (DEFICIT)

    

Preferred Stock, $0.01 par value, 772,210 issued and outstanding shares with a liquidation preference of $3,861 at December 31, 2015 and 0 shares authorized, issued and outstanding at December 31, 2014

   $ 1,174      $ —     

Class A common stock, $0.01 par value, 11,038,071 shares authorized, 2,997,437 and 2,726,455 issued and outstanding, respectively

     30        27   

Class B common stock, $0.01 par value, 390,500 shares authorized, issued and outstanding

     4        4   

Additional paid-in capital

     175,963        171,639   

Treasury stock, at cost (85,570 and 74,576 shares Class A common stock, respectively)

     (2,662     (2,583

Accumulated deficit

     (175,785     (171,218
  

 

 

   

 

 

 

TOTAL COMSTOCK HOLDING COMPANIES, INC. (DEFICIT)

     (1,276     (2,131

Non-controlling interests

     6,717        3,986   
  

 

 

   

 

 

 

TOTAL EQUITY

     5,441        1,855   
  

 

 

   

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

   $ 58,478      $ 56,367   
  

 

 

   

 

 

 


COMSTOCK HOLDING COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS

(Amounts in thousands, except per share data)

 

     Year Ended December 31,  
     2015     2014  

Revenues

    

Revenue—homebuilding

   $ 60,132      $ 47,378   

Revenue—other

     1,244        587   
  

 

 

   

 

 

 

Total revenue

     61,376        47,965   

Expenses

    

Cost of sales—homebuilding

     51,583        38,133   

Cost of sales—other

     551        372   

Impairment charges and write-offs

     2,765        2,695   

Sales and marketing

     2,076        2,130   

General and administrative

     7,410        7,585   

Interest and real estate tax expense

     547        26   
  

 

 

   

 

 

 

Operating loss

     (3,556     (2,976

Other income, net

     861        230   
  

 

 

   

 

 

 

Loss before income tax benefit (expense)

     (2,695     (2,746

Income tax benefit (expense)

     732        (368
  

 

 

   

 

 

 

Net loss

     (1,963     (3,114

Less: Net income attributable to non-controlling interests

     2,604        3,725   
  

 

 

   

 

 

 

Net loss attributable to Comstock Holding Companies, Inc.

   $ (4,567   $ (6,839
  

 

 

   

 

 

 

Basic loss per share

   $ (1.43   $ (2.27

Diluted loss per share

   $ (1.43   $ (2.27

Basic weighted average shares outstanding

     3,198        3,012   

Diluted weighted average shares outstanding

     3,198        3,012   


 

 

    Pipeline Report as of December 31, 2015  

Project

  State   Product
Type (1)
  Estimated
Units at
Completion
    Units
Settled
    Backlog (8)     Units
Owned
Unsold
    Units Under
Control (2)
    Total Units
Owned,
Unsettled and
Under Control
    Average
New Order
Revenue Per
Unit to Date
 

City Homes at the Hampshires

  DC   SF     38        37        —          1        —          1        746   

Townes at the Hampshires (3)

  DC   TH     73        70        2        1        —          3        552   

Estates at Falls Grove

  VA   SF     19        8        3        8        —          11        537   

Townes at Falls Grove

  VA   TH     110        57        4        49        —          53        301   

Townes at Shady Grove Metro

  MD   TH     36        26        —          10        —          10        581   

Townes at Shady Grove Metro (4)

  MD   SF     3        3        —          —          —          —          —     

Momentum | Shady Grove Metro (5)

  MD   Condo     110        —          —          110        —          110        —     

Estates at Emerald Farms

  MD   SF     84        78        —          6        —          6        —     

Townes at Maxwell Square

  MD   TH     45        32        9        4        —          13        421   

Townes at Hallcrest

  VA   TH     42        7        2        33        —          35        467   

Estates at Leeland

  VA   SF     24        —          1        23        —          24        438   

Villas | Preserve at Two Rivers 28’

  MD   TH     10        2        —          8        —          8        445   

Villas | Preserve at Two Rivers 32’

  MD   TH     10        3        4        3        —          7        509   

Estates at Popkins Lane

  VA   SF     12        —          —          —          12        12        —     

Townes at Richmond Station

  VA   TH     54        —          —          —          54        54        —     

Richmond Station Multi-family

  VA   MF     104        —          —          —          104        104        —     

Townes at Totten Mews (6)

  DC   TH     40        —          —          —          40        40        —     

Marrwood East (7)

  VA   SF     35        —          —          —          35        35        —     
     

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

        849        323        25        256        245        526     
     

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) “SF” means single family home, “TH” means townhouse, “Condo” means condominium and “MF” means multi-family.
(2) Under land option purchase contract, not owned.
(3) 3 of these units are subject to statutory affordable dwelling unit program.
(4) Units are subject to statutory moderately priced dwelling unit program.
(5) 16 of these units are subject to statutory moderately priced dwelling unit program.
(6) 5 of these units are subject to statutory affordable dwelling unit program.
(7) 1 of these units is subject to statutory affordable dwelling unit program.
(8) “Backlog” means we have an executed order with a buyer but the settlement did not occur prior to report date.

View source version

on businesswire.com: http://www.businesswire.com/news/home/20151116006557/en/

Company:

Comstock Holding Companies, Inc.

Christopher Conover, 703-230-1985

Interim Chief Financial Officer

or

Investor Relations:

LHA

Jody Burfening / Harriet Fried, 212-838-3777

hfried@lhai.com

Source: Comstock Holding Companies, Inc.

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