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California Coastal Communities, Inc. Reports Second Quarter Results.

Article Excerpt
- Second quarter revenues of $10.5 million from 12 deliveries, including nine Brightwater homes. - Gross operating profit of $1.9 million generated primarily from nine Brightwater homes, compared with $2.2 million of gross operating profit before impairment charges for the comparable period of 2008. - Net loss of $7.3 million, or $.66 per share, reflects valuation allowances on deferred tax assets aggregating $7.6 million, or $.69 per share, partially offset by Brightwater gross operating profit, compared with a net loss of $3.1 million in second quarter of 2008.

IRVINE, Calif., Aug. 7 /PRNewswire-FirstCall/ -- California Coastal Communities, Inc. reported $1.9 million of gross operating profit for the quarter ended June 30, 2009 compared with $2.2 million of gross operating profit before inland project impairment charges for the comparable period of 2008. Net loss for the quarter was $7.3 million, or $.66 per diluted share compared with a net loss of $3.1 million or $.28 per diluted share for the second quarter of 2008.

Results for the second quarter of 2009 reflect the delivery of 12 homes at the Company's homebuilding projects in Southern California (including nine homes at its Brightwater coastal development project) compared to delivery of 15 homes in the second quarter of 2008 (including seven Brightwater deliveries). Gross operating profit of $1.9 million in the second quarter of 2009 was offset by net operating expenses of $1.4 million, compared with $5.0 million of impairment charges and $2.4 million of net operating expenses in the second quarter of 2008. Income tax expense of $7.8 million for the second quarter of 2009 includes $7.6 million of non-cash valuation allowances on deferred tax assets.

The decrease in net operating expenses for the second quarter of 2009 compared with the second quarter of 2008 reflects a $600,000 reduction in selling expenses primarily associated with communities which were active during the first half of 2008 but had reduced or no activity in the current year, as well as reduced general and administrative expenses resulting from headcount reductions and the absence of holding costs for the Corona project, the majority of which was deeded to the lender on March 31, 2009.

Raymond J. Pacini, CEO of the Company commented: "While our operating results continue to reflect the ongoing downturn in the homebuilding industry, we are encouraged by steady sales of the smaller homes at Brightwater during the quarter. During the last five months (March-July), we generated 20 net sales orders at Brightwater. However, the limited availability of jumbo mortgage financing and excess supply of resale homes over $1.5 million in Huntington Beach continues to constrain sales of the larger Cliffs and Breakers homes."

The Company's 105-acre Brightwater project is located in Huntington Beach, California near the corner of Pacific Coast Highway and Warner Avenue, overlooking the Pacific Ocean and the 1,300-acre Bolsa Chica Wetlands. It is the largest asset in the Company's portfolio, representing approximately 95% of real estate inventories as of June 30, 2009. Due to the Company's low carrying value in...

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