Income Opportunity Realty Investors, Inc. (IOR) reported its financial results for the three and nine months ended September 30, 2024, reflecting a decline in net income compared to the same periods in 2023. For the three months ended September 30, 2024, net income was $1,198,000, down from $1,643,000 in the prior year, while for the nine months, net income decreased to $3,538,000 from $4,527,000. Correspondingly, earnings per share (EPS) for the three months was $0.29, compared to $0.39 in 2023, and for the nine months, EPS fell to $0.87 from $1.09.

The decrease in net income is primarily attributed to a reduction in interest income from related party receivables. Interest income from these receivables for the three months ended September 30, 2024, was $1,464,000, down from $2,178,000 in the same period of 2023. For the nine months, interest income also declined to $4,336,000 from $6,157,000. Despite the drop in income, the company managed to reduce general, administrative, and advisory fees, which partially offset the decline in net income.

As of September 30, 2024, IOR's total assets increased to $120,817,000 from $118,078,000 at the end of 2023. Current assets rose to $109,671,000, while cash and cash equivalents significantly decreased to $14,000 from $71,000. Retained earnings increased to $60,566,000, up from $57,028,000, and total shareholders’ equity rose to $120,814,000.

In terms of strategic developments, IOR consolidated four notes receivable from Unified Housing Foundation, Inc. into a single note with a floating interest rate indexed to the Secured Overnight Financing Rate (SOFR). The new interest rate was 5.33% as of September 30, 2024. Additionally, $605,000 of accrued interest was forgiven in exchange for increased participation in future refinancing proceeds.

Advisory fees paid to Pillar Income Asset Management, Inc. decreased significantly, with fees for the three months ended September 30, 2024, totaling $26 compared to $346 in 2023. For the nine months, advisory fees were $76, down from $1,045.

The company continues to engage in related party transactions, which may not always be conducted at arm's length. As of September 30, 2024, IOR anticipates that its cash and cash equivalents, along with cash generated from related party receivables, will be sufficient to meet its current cash requirements over the next twelve months. Management has confirmed the effectiveness of the company's disclosure controls and procedures, with no significant changes in internal control over financial reporting during the quarter.