arl-20220812

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)			August 12, 2022

American Realty Investors, Inc.

(Exact name of registrant as specified in its charter)

Nevada

001-15663

75-2847135

(State or other jurisdiction of
Incorporation or organization)

(Commission File Number)

(IRS Employer Identification Number)

1603 LBJ Freeway,

Suite 800

Dallas

75234

(Address of principal executive offices)

(Zip Code)

(469) 522-4200

Registrant’s Telephone Number, including area code

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:

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

☐ Soliciting material pursuant to Rule 14a-12 under the Securities Act (17 CFR 230.425)

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

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Securities Act (17 CFR 240.413e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	ARL	NYSE

Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 ((17 CFR 230.405 of or Rule 12b-2 of the Securities Act of 1934 (17 CFR 230.405):

☐ Emerging growth company

If an emerging growth company indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Section 2 – Financial Information

Item 2.02. Results of Operations and Financial Condition

On August 12, 2022, American Realty Investors, Inc. (“ARL” or the “Company”) announced its operational results for the quarter ended June 30, 2022. A copy of the announcement is attached as Exhibit “99.1.”

The information furnished pursuant to Item 2.02 in this Form 8-K, including Exhibit “99.1” attached hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, unless we specifically incorporate it by reference in a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934. We undertake no duty or obligation to publicly update or revise the information furnished pursuant to Item 2.02 of this Current Report on Form 8-K.

Section 9 – Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits

(d) Exhibits.

The following exhibit is furnished with this Report:


Exhibit No.	Description
99.1*	Press release dated	August 12, 2022

_________________________

* Furnished herewith

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


		AMERICAN REALTY INVESTORS, INC.

Dated: August 12, 2022	By:	/s/ ERIK L. JOHNSON
		Erik L. Johnson
		Executive Vice President and Chief Financial Officer

Document


NEWS RELEASE						Contact:
						American Realty Investors, Inc. Investor Relations
FOR IMMEDIATE RELEASE						Erik Johnson (469) 522-4200 investor.relations@transconrealty-invest.com

American Realty Investors, Inc. reports Earnings for Quarter Ended June 30, 2022

DALLAS (August 12, 2022) -- American Realty Investors, Inc. (NYSE:ARL) is reporting its results of operations for the quarter ended June 30, 2022. For the three months ended June 30, 2022, we reported net income attributable to the Company of $16.3 million or $1.01 per diluted share, compared to net loss of $27.3 million or $1.69 per diluted share for the same period in 2021.

Financial Highlights

•We collected approximately 97% of our rents for the three months ended June 30, 2022, comprised of approximately 98% from multifamily tenants and approximately 96% from office tenants.

•Total occupancy was 90% at June 30, 2022, which includes 93% at our multifamily properties and 69% at our commercial properties.

Financial Results

Rental revenues decreased $2.9 million from $10.2 million for the three months ended June 30, 2021 to $7.3 million for the three months ended June 30, 2022. The decrease in rental revenue is primarily due to the sale of 600 Las Colinas in 2021 and the sale of Toulon in the first quarter of 2022.

Net operating loss decreased $5.7 million from $8.8 million for three months ended June 30, 2021 to $3.0 million for the three months ended June 30, 2022. The decrease in net operating loss is primarily due to a reduction of legal costs related to the Clapper litigation and arbitration settlement in 2021 offset in part by net operating profit from the sale of 600 Las Colinas in 2021.

Net income attributable to the Company increased $43.6 million from a net loss $27.3 million for the three months ended June 30, 2021 to net income of $16.3 million for the three months ended June 30, 2022. The increase in net income is primarily attributed to to the $29.6 million arbitration settlement of the Earn Out Obligation in 2021 and $18.9 million increase in gain on foreign currency transactions due to the improved exchange rate of the U.S. Dollar to the New Israeli Shekel.

About American Realty Investors, Inc.

American Realty Investors, Inc., a Dallas-based real estate investment company, holds a diverse portfolio of equity real estate located across the U.S., including office buildings, apartments, shopping centers, and developed and undeveloped land. The Company invests in real estate through direct ownership, leases and partnerships and invests in mortgage loans on real estate. The Company also holds mortgage receivables. The Company’s primary asset and source of its operating results is its investment in Transcontinental Realty Investors, Inc. (NYSE:TCI). For more information, visit the Company’s website at www.americanrealtyinvest.com.

AMERICAN REALTY INVESTORS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, except per share amounts)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Revenues:
Rental revenues	$	7,259	$	10,194	$	14,740	$	20,555
Other income	870		909		1,176		2,376
Total revenue	8,129		11,103		15,916		22,931
Expenses:
Property operating expenses	3,812		5,058		7,840		10,890
Depreciation and amortization	2,298		3,211		4,647		6,538
General and administrative	2,194		5,866		4,914		9,101
Advisory fee to related party	2,858		5,739		6,043		8,175
Total operating expenses	11,162		19,874		23,444		34,704
Net operating loss	(3,033)		(8,771)		(7,528)		(11,773)
Interest income	9,419		5,616		16,201		11,260
Interest expense	(6,389)		(7,681)		(12,556)		(15,419)
Gain (loss) on foreign currency transactions	14,132		(4,793)		17,904		2,824
Loss on extinguishment of debt	—		—		(1,639)		—
Equity in income from unconsolidated joint ventures	2,048		4,572		7,242		7,908
Gain (loss) on sale or write-down of assets, net	3,893		(24,445)		15,041		(7,047)
Income tax provision	(40)		1,841		(68)		1,801
Net income (loss)	20,030		(33,661)		34,597		(10,446)
Net (income) loss attributable to noncontrolling interest	(3,718)		6,333		(6,971)		1,186


Net income (loss) attributable to the Company	$	16,312	$	(27,328)	$	27,626	$	(9,260)
Earnings per share
Basic and diluted	$	1.01	$	(1.69)	$	1.71	$	(0.57)
Weighted average common shares used in computing earnings per share
Basic and diluted	16,152,043		16,152,043		16,152,043		16,152,043