LAACO, LTD. Releases Third Quarter Financials

November 1, 2011

The real estate partnership, LAACO, LTD. (LAACZ.PK), saw revenues for its third quarter ended September 30, 2011 remain essentially flat at $13.3 million. Net income for the period was down slightly to $3 million or $17.27 per partnership unit. For the nine month period, revenue increase roughly 2% to $40.2 million driven by increased revenues from club operations. Net income slipped 4.6% to $8.83 million or $51.25 per partnership unit due to higher operating expenses.

The balance sheet remains strong with $12.3 million in cash and cash equivalents and total liabilities of $48.2 million. Total assets of the company were $200 million which in addition to the cash is primarily made up of its real estate. The company raised its quarterly distribution 15% in 2011 to $11.50 per quarter. This gives the partnership a current yield of 4.6% at the recent asking price of $1000 per unit.

LAACO derives most of its revenue from 45 self-storage facilities located in the western United States. It also derives revenue from two legacy club properties and parking facilities. The legacy club properties include The Los Angeles Athletic Club and the California Yacht Club. The recession has had an impact on all of the partnership’s operations, but management is seeing some modest improvement with The Los Angeles Athletic Club operation due to what management believes is a result of timely room renovations combined with an influx of new residences and businesses in the downtown Los Angeles area.

Source: LAACO, LTD.

Disclosure: The author does not own any securities mentioned in this article at the time of publishing.


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