Barnwell net drops 75 percent

The third-quarter fall is attributed to a large real estate transaction

Barnwell Industries Inc. said yesterday its oil and natural gas revenue increased in the fiscal third quarter but the company's overall net income plunged 75.5 percent due to a large real estate transaction in the year-earlier period.

The Honolulu-based company, which has real estate holdings on the Big Island, posted earnings of $743,000, or 9 cents a share, compared with $3 million, or 35 cents a share, a year ago.

In the year-earlier quarter, Barnwell's 78 percent-owned real estate development partnership, Kaupulehu Developments, recognized net revenue of $6.2 million from a transaction.

There was no similar transaction in the just-finished quarter.

Revenue for the three months ended June 30 fell 31.1 percent to $11.8 million from $17.1 million. However, oil and natural gas revenue increased $765,000, or 9 percent, due to an increase in prices for natural gas, said Morton Kinzler, the company's chairman and chief executive.

Barnwell continues to invest in Big Island real estate, and last quarter acquired a 1.2 percent passive interest in Kona Village Resort -- adjacent to both Hualalai Resort and Lot 4A of Kaupulehu.

In addition, its real estate development partnership purchased two house lots in the Lot 4A Increment I area of Kaupelehu in North Kona, with construction of the first house estimated to begin next month, according to Kinzler.

"(Kaupulehu Developments) plans to acquire house lots for investment and construct single-family homes for sale," Kinzler said.

Barnwell's board of directors also said today it was maintaining its dividend of 5 cents a share. It will be payable Sept. 21 to shareholders of record on Sept. 7.