Overview

The Company's operations during 2021 include leasing its office building located in Parkersburg West Virginia, its principal source of cash and income was the interest it receives from notes receivables.

In August 2020, the Company sold its oil and gas wells and mineral leases which were located in Ohio and West Virginia. The oil and operations for the periods included in this report are reflected as discontinued operations.

Critical Accounting Policies and Estimates

The Company's discussion and analysis of its financial condition and results of operations are based upon the Company's consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. Certain of the Company's accounting policies require the application of judgment in selecting the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. These judgments and estimates are based upon the Company's historical experience, current trends and information available from other sources that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.





Deferred Tax Assets

Significant management judgment is required in determining the provision for income taxes, deferred tax assets and liabilities and any valuation allowance recorded against net deferred tax assets. The future recoverability of the Company's net deferred tax assets is dependent upon the generation of future taxable income prior to the expiration of the loss carry forwards. At December 31, 2021, the Company had a deferred tax asset due to tax deductions available to it in future years. However, as management could not determine that it was more likely than not that the benefit of the deferred tax asset would be realized, a 100% valuation allowance was established.

Liquidity and Capital Resources

At December 31, 2021, the Company had current assets of $3,812,000 and current liabilities of $60,000.

Cash and cash equivalents totaled $252,000 at December 31, 2021 and $27,000 at December 31, 2020. New Concept's principal sources of cash was rent from the tenant occupying part of its building in West Virginia and interest from its notes receivable





Results of Operations

Fiscal 2021 as compared to 2020

Revenues: Total revenues from rent for the leased property was $101,000 in 2021 and 2020.

Operating Expenses: Operating expenses for the real estate property was $77,000 in 2021 and $72,000 in 2020. General and administrative expenses were $360,000 in 2021 and $396,000 in 2020.

Interest Income: Interest Income was $220,000 in 2021 as compared to $242,000 in 2020. The decrease was due to the reduction in the principal balance outstanding due to payments received.

Other Income: Other income was $191,000 in 2021 which is an income tax refund for prior years of $91,000 and $100,000 from the sale of a receivable that had been fully reserved in prior years. Other income was $85,000 in 2020 which is principally an income tax refund for prior years.



7

Fiscal 2020 as compared to 2019

Revenues: Total revenues from rent for the leased property was $101,000 in 2020 and $98,000 in 2019.

Operating Expenses: Operating expenses for the real estate property was $72,000 in 2020 and $61,000 in 2019. General and administrative expenses were $396,000 in 2020 and 418,000 in 2019.

Interest Income: Interest Income was $242,000 in 2020 as compared to $257,000 in 2019. The decrease was due to the reduction in the principal balance outstanding due to payments received.

Other Income: Other income was $85,000 in 2020 which is an income tax refund for prior years. Other income was $199,000 in 2019 which is comprised of a gain on sale of equipment of $46,000 and the settlement of a legal claim of $153,000.

Discontinued Operations: During the first nine months of 2020 the Company recorded a net loss from its oil and gas operations of $170,000. In August 2020, the Company sold the oil and gas operation and recorded a gain of $2,138,000.

© Edgar Online, source Glimpses