ST. CHARLES, Md., March 30 /PRNewswire-FirstCall/ -- American Community Properties Trust ('ACPT' or the 'Company'), (Amex: APO), today announced results for the year and quarter ended December 31, 2008. For the year ended December 31, 2008, ACPT reported a net loss of $11,356,000, or $2.18 per basic and diluted share, on revenues of $82,914,000. This compares to a net loss of $541,000, or $0.10 per basic and diluted share, on revenues of $85,376,000 for the year ended December 31, 2007. For the year ended December 31, 2008, operating income was $7,356,000, compared to $16,082,000 in 2007. Impairment charges of $7,456,000, an allowance for deferred tax assets of $3,403,000 and $4,691,000 of severance and salary expenses for employees who are no longer with the Company are included in the 2008 results.
For the quarter ended December 31, 2008, ACPT reported a net loss of $9,355,000, or $1.80 per basic and diluted share, on revenues of $24,634,000. This compares to net income of $718,000, or $0.14 per basic and diluted share, on revenues of $23,919,000 for the same quarter in 2007. For the quarter ended December 31, 2008, ACPT reported an operating loss of $3,135,000, compared to operating income of $4,771,000 in the same quarter in 2007. Impairment charges of $7,456,000, an allowance for deferred tax assets of $3,403,000 and $3,315,000 of severance and salary expenses for employees who are no longer with the Company are included in the 2008 fourth quarter results.
Steve Griesselx, who was appointed Chief Executive Officer of the Company effective October 1, 2008, said that overall results for 2008 reflect the difficult macro-economic conditions existing in the market, costs associated with streamlining the Company's management structure and reducing the staff count, and impairment charges on property in Parque Escorial, Puerto Rico and Baltimore, Maryland.
Mr. Griessel also said the Company has dramatically changed the focus of its operations since October 1, 2008. 'We are now focused on generating free cash flow and attempting to strategically divest assets to strengthen our balance sheet. We split the Company into two primary segments based on our business lines of operating real estate and land development as opposed to strictly reporting them geographically. We believe the revised segment reporting makes the performance of each line of business easier to understand and allows us to focus on making each operate independently. It also highlights the historical dependence that the land development entity has had on the operations and cash flows of our operating real estate, as evidenced by a significant intercompany loan balance at December 31, 2008. We believe that restructuring and representing our operations in this manner makes the Company more efficient while leaving us well-positioned to capitalize on future growth opportunities,' said Mr. Griessel.
Matthew M. Martin, Chief Financial Officer, noted that the Company was subject to two impairments and a valuation allowance for certain deferred tax assets that significantly affected the Company's financial results. In Puerto Rico, the Company reported a $6,200,000 impairment charge related to the Hilltop section of Parque Escorial, the last section of the 2,700 unit planned community. The Company also reported a $1,256,000 impairment charge related to its apartment properties in Baltimore, Maryland. In addition, the Company recorded a $3,403,000 valuation allowance for deferred tax assets for investments and property management services for which future income could not be projected in the near term.
Mr. Martin also noted that revenues from the Company's investment property portfolio increased 3%, to $62,243,000 for 2008. Net operating income (1) for the U.S and Puerto Rico Operating Real Estate segments also increased $2,145,000, or 11%, and $343,000, or 3%, respectively, as compared to 2007. Mr. Martin attributed the increase to a full twelve months of operations of Sheffield Greens apartments in the United States in 2008, overall rent increases of 3% at properties in the United States and Puerto Rico, and a decrease of $965,000 in rental property expenses due to improvements in operating efficiencies. Funds from Operations (2) ('FFO') in the U.S. Operating Real Estate segment decreased by $831,000, or 11%, driven by the $1,256,000 impairment charge in the fourth quarter of 2008 offset by a full twelve months of operations of Sheffield Greens apartments. FFO from the Puerto Rico Operating Real Estate segment increased by $395,000, or 20%, as compared to 2007, primarily attributable to an increase in the annual rent in 2008 and controlling the costs of property operations.
Mr. Martin added that in St. Charles, Maryland, the Company reported sales of 61 single family lots and 58 town home lots generating revenue of approximately $8,700,000 in 2008, compared to 34 single family and 44 town home lots generating revenue of approximately $5,900,000 in 2007. 'Although the number of lots delivered increased, we saw a reduction in final lot price between 2007 and 2008. Average single family final lot prices decreased 28% to $90,000 per lot and townhouse final lot prices decreased 22% to $73,000. These declines were driven by Lennar bringing a more affordable product into St. Charles,' said Mr. Martin.
In addition to lot sales, in December 2008 the Company sold its interest in the Heritage at St. Charles joint venture to Lennar for $3,467,000.
