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California Coastal Communities, Inc. Reports Profitable First Quarter.

Article Excerpt
- First quarter revenues of $12.8 million, up 156% year-over-year, reflecting increase in Brightwater deliveries from two to five homes, including three ocean view homes averaging $3.2 million.

- Gross operating profit of $4.0 million before impairment charges generated primarily from five Brightwater homes, compared with $1.1 of gross operating profit for the comparable period of 2008.

- Net income of $11.2 million, or $1.02 per diluted share, reflects $20.7 million pre-tax gain from income attributable to cancellation of indebtedness in addition to Brightwater gross operating profit and $3.2 million of non-cash impairment charges on an inland development project, compared with a net loss of $700,000 in first quarter of 2008.

IRVINE, Calif., May 14 /PRNewswire-FirstCall/ -- California Coastal Communities, Inc. reported $4.0 million of gross operating profit before inland project impairment charges for the quarter ended March 31, 2009 compared with $1.1 million of gross operating profit for the comparable period of 2008. Net income for the quarter was $11.2 million, or $1.02 per diluted share compared with a net loss of $700,000 or $.06 per diluted share for the first quarter of 2008.

Results for the first quarter of 2009 reflect a $20.7 million pre-tax gain from cancellation of indebtedness income attributable to the debt restructuring (discussed below) and the delivery of seven homes at the Company's homebuilding projects in Southern California (including five homes at its Brightwater coastal development project) compared to delivery of eight homes in the first quarter of 2008 (including two Brightwater deliveries). Gross operating profit of $800,000 in the first quarter of 2009 reflects impairment charges of $3.2 million related to one inland project in Beaumont, and was offset by net operating expenses of $2.6 million, compared with no impairment charges and $2.2 million of net operating expenses in the first quarter of 2008.

The increase in net operating expenses for the first quarter of 2009 compared with the first quarter of 2008 primarily reflects a $700,000 increase in interest expense and a $300,000 increase in property tax expense related to projects which are no longer under construction. These increases were partially offset by the absence in 2009 of $700,000 of other expense incurred in the first quarter of 2008 related to an interest rate swap agreement.

On March 31, 2009, the Company completed a deed-in-lieu transaction for a subsidiary's project in Corona. In exchange for a $28.7 million reduction in the project loan balance, the Company's subsidiary conveyed 134 finished lots and recognized a $20.7 million pre-tax gain on this debt restructuring. As of May 11, 2009, the Company's...

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