Transcontinental Realty Investors Reports 2002 Second Quarter, Six Months Net Losses of $.24 and $.41 vs. $1.64 and $1.68 Net Income in 2001 Periods


DALLAS, Aug. 14, 2002 (PRIMEZONE) -- Transcontinental Realty Investors, Inc. (NYSE:TCI) announced Wednesday 2002 second quarter and six months net losses of $1.90 million and $3.28 million, or ($.24) per share and ($.41) per share, on revenues of $30.65 million and $58.96 million, as compared to net incomes of $14.32 million and $14.63 million, or $1.64 per share and $1.68 per share, on revenues of $28.05 million and $53.42 million for the comparable periods in 2001, due to decreased occupancy rates, lower gains on the sale of properties and increased expenses.

Income for the second quarter and six months of 2002 included:


 -- Increased rents in the second quarter and six months due to the
    purchase of five apartments and a shopping center in 2002 and
    2001, increased rental rates and steady occupancy at the
    apartments, and construction completed on an apartment complex and
    a hotel, offset in the six months by decreases in occupancy at the
    commercial properties and U.S. hotels.
 -- Increased interest and other income due to 14 loans funded in 2001
    and 2002.
 -- Decreased equity in losses of equity investees of $291,000 and
    $1.57 million, compared to $1.02 million and $2.39 million in the
    comparable periods of 2001.  

Total expenses increased for second quarter and six months 2002 to $39.13 million and $73.30 million, from $34.91 million and $66.59 million for the same periods in 2001. Total expenses included:


 -- Operations expense of $18.92 million and $36.28 million, up from
    $15.02 million and $30.37 million in the 2001 periods, due to the
    completion of construction of an apartment and a hotel in 2002,
    the purchase of five apartments and a shopping center in 2001 and
    higher repairs, taxes, insurance and personnel expense. 
 -- Provision for asset impairment of $1.88 million, representing the
    write down of four apartments and one land parcel; no provision
    for asset impairment was recorded in the 2001 periods.
 -- Interest expense of $9.63 million and $17.99 million, up from
    $8.15 million and $16.55 million in the 2001 periods, due to costs
    related to refinancing properties in 2002 and the 2001-2002
    purchase of eight properties subject to debt, partially offset by
    lower variable interest rates and principal paydowns. 
 -- Depreciation of $4.89 million and $9.78 million, up from $4.10
    million and $8.06 million in the 2001 periods, due to the purchase
    of apartments in 2001-2002, the completion of construction of an
    apartment and a hotel and capital improvements in the office
    buildings and hotels.
 -- General and administrative expenses of $2.21 million and $4.41
    million, down from $3.50 million and $5.92 million in the 2001
    periods, due to decreased legal and other professional fees.
 -- Advisory fees, net income fees and incentive fees totaled $1.28
    million and $2.69 million, down from $4.12 million and $5.65
    million in the 2001 periods.  No net income or incentive fees were
    paid in the first six months of 2002.

Discontinued operations on properties sold for the second quarter and six months of 2002 included:


 -- Gains on the sale of operations of $7.09 million and $9.59
    million, down from $20.62 million and $25.83 million in the 2001
    periods.  The 2002 gains were the result of sales of four
    apartments, three office buildings and a warehouse.
 -- Equity in investees gain on sale of real estate of $183,000 and
    $3.10 million, compared to $1.64 million and $2.92 million in the
    2001 periods.

Transcontinental Realty Investors, Inc., a Dallas-based real estate investment company, invests in real estate through direct equity ownership and partnerships nationwide. For more information, go to the web site at www.transconrealty-invest.com.


                         FINANCIAL HIGHLIGHTS
        (dollars in thousands, except share and per share data)

                      Three months ended        Six months ended
                            June 30,                  June 30,
                       2002         2001         2002         2001
                    ----------   ----------   ----------   ----------
 Income from rents  $   29,960   $   28,402   $   58,476   $   54,502
 Expense from
  operations            18,916       15,020       36,276       30,371
                    ----------   ----------   ----------   ----------
   Operating income     11,044       13,382       22,200       24,131
 Other income
  (loss)            $      693   $     (349)  $     (484)  $   (1,084)
 Other expense          20,213       19,887       37,020       36,221
                    ----------   ----------   ----------   ----------
 Net loss from
  continuing
  operations            (8,476)      (6,854)     (14,336)     (13,174)
 Net loss from
  discontinued
  operations              (645)      (1,080)      (1,550)        (928)
 Gain on sale of
  operations             7,085       20,623        9,593       25,833
 Equity in investees
  gain on sale of
  operations               183        1,642        3,104        2,916
                    ----------   ----------   ----------   ----------
                         6,623       21,185       11,147       27,821

 Net income
  (loss)            $   (1,853)  $   14,331   $   (3,189)  $   14,647
 Preferred dividend
  requirement              (45)          (8)         (90)         (15)
                    ----------   ----------   ----------   ----------
 Net income (loss)
  applicable to
  Common shares     $   (1,898)  $   14,323   $   (3,279)  $   14,632
                    ==========   ==========   ==========   ==========
 Earnings Per Share
  Net loss from
   continued
   operations       $    (1.05)  $     (.79)  $    (1.78)  $    (1.52)
  Net income from
   discontinued
   operations              .82         2.45         1.39         3.21
 Net income
  applicable to
  Common shares     $     (.24)  $     1.65   $     (.41)  $     1.69
                    ==========   ==========   ==========   ==========
 Diluted earnings
  per share
   Net loss from
    continued
    operations      $    (1.05)  $     (.79)  $    (1.78)  $    (1.52)
   Net income from
    discontinued
    operations             .80         2.43         1.34         3.19
                    ----------   ----------   ----------   ----------
 Net income
  applicable to
  Common shares     $     (.24)  $     1.64   $     (.41)  $     1.68
                    ==========   ==========   ==========   ==========
 Weighted average
  common shares
  used to compute
  earnings per share
   Basic             8,042,594    8,661,091    8,042,594    8,661,217
   Diluted           8,291,884    8,734,388    8,296,082    8,734,514

            

Contact Data