Revenue increased for the 13th consecutive quarter to $14.5 million; YTD revenue of $33.7 million, up 12% vs. prior year
Net income increased 27% to $4.7 million; YTD net income of $5.9 million
Adjusted EBITDA increased 35% to $5.6 million; YTD Adjusted EBITDA of $8.3 million, up 16% vs. prior year
Commercial and Residential portfolios each remain well over 90% leased
Parking management expansion continues, 37% revenue growth vs. prior year; YTD revenue up 54%
Further strengthened balance sheet, including 81% current ratio growth vs. 12/31/22

Comstock Holding Companies, Inc. (NASDAQ:CHCI) ("Comstock" or the "Company"), a leading asset manager, developer, and operator of mixed-use and transit-oriented properties in the Washington, D.C. region, announced its financial results for the third quarter ended September 30, 2023.

"The strategic growth platform we have built at Comstock continues to produce positive results, as evidenced by top-line revenue growth for the 13th consecutive quarter that included a 13% increase in recurring fee-based revenue streams," said Christopher Clemente, Comstock's Chairman and Chief Executive Officer. "In Q3 we achieved significant increases in both operating income and Adjusted EBITDA while further strengthening our balance sheet, a testament to the resiliency of our business model. We remain well-positioned to both sustain current operations and capitalize on new growth opportunities that may arise during this time of dislocation in the real estate industry. I am proud of the high-quality assets we manage and our best-in-class team members that show up every single day focused on providing remarkable services and experiences. I look forward to reporting on our continued success in future periods as we strive to maximize value for our shareholders."

Key Performance Metrics¹

($ in thousands, except per share and portfolio data)		Q3 2023		Q3 2022		YTD 2023		YTD 2022
	Revenue	$	14,463	$	12,813	$	33,705	$	30,011

	Income from operations	$	5,257	$	3,875	$	7,221	$	6,357
	Net income		4,685		3,689		5,914		6,417	³

	Adjusted EBITDA	$	5,605	$	4,143	$	8,258	$	7,137

	Net income per share — diluted	$	0.46	$	0.37	$	0.59	$	0.90	^{2, 3}

	Managed Portfolio - # of assets		46		40		46		40

¹	All amounts represent continuing operations. Please see the included financial tables for a reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure

²	Amount reflects $2.0 million positive impact of Q2 2022 Series C Preferred Stock redemption

³	Amounts reflect impact of $0.5 million non-cash tax benefit stemming from partial release of deferred tax valuation allowance

Q3 2023 Highlights

Recognized $4.8 million incentive fee revenue based on achievement of operating asset stabilization, pursuant to the terms of the 2022 Asset Management Agreement ("2022 AMA").

Welcomed Securiport, Noku Sushi, and Tous les Jour to Reston Station, which has secured 8 new leases year-to-date covering nearly 200,000 sqft of office and retail spaces.

Managed commercial portfolio leased percentage of 92%, up from 87% in Q3 2022; produced in-place rent growth of 5.5% vs. prior year.

Managed residential portfolio leased percentage of 97%, up from 88% in Q3 2022; produced in-place rent growth of 5.1% vs. prior year.

Continued growth of parking management portfolio, including 26% growth in average parking management contract value vs. prior year.

Added former JBG Smith executive David Paul to Board of Directors.

About Comstock

Founded in 1985, Comstock is a leading asset manager, developer, and operator of mixed-use and transit-oriented properties in the Washington, D.C. region. With a managed portfolio comprising approximately 10 million square feet at full build-out that includes stabilized and development assets strategically located at key Metro stations, Comstock is at the forefront of the urban transformation taking place in the fastest growing segments of one of the nation's best real estate markets. Comstock's developments include some of the largest and most prominent mixed-use and transit-oriented projects in the mid-Atlantic region, as well as multiple large-scale public-private partnership developments. For more information, please visit Comstock.com.

Cautionary Statement Regarding Forward-Looking Statements

This release may include "forward-looking" statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by use of words such as "anticipate," "believe," "estimate," "may," "intend," "expect," "will," "should," "seeks" or other similar expressions. Forward-looking statements are based largely on our expectations and involve inherent risks and uncertainties, many of which are beyond our control. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements. Additional information concerning important risk factors and uncertainties can be found under the heading "Risk Factors" in our latest Annual Report on Form 10-K, as filed with the Securities and Exchange Commission. Comstock specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.

COMSTOCK HOLDING COMPANIES, INC.
Consolidated Balance Sheets
(Unaudited; In thousands)

	September 30,			December 31,
	2023			2022
Assets
Current assets:
Cash and cash equivalents	$	10,935		$	11,722
Accounts receivable, net		571			504
Accounts receivable - related parties		10,381			3,291
Prepaid expenses and other current assets		307			264
Total current assets		22,194			15,781
Fixed assets, net		512			421
Intangible assets		144			144
Leasehold improvements, net		97			119
Investments in real estate ventures		5,984			7,013
Operating lease assets		7,002			7,625
Deferred income taxes, net		10,720			11,355
Other assets		35			15
Total assets	$	46,688		$	42,473

Liabilities and Stockholders' Equity
Current liabilities:
Accrued personnel costs	$	3,226		$	4,959
Accounts payable and accrued liabilities		975			742
Current operating lease liabilities		838			791
Total current liabilities		5,039			6,492
Operating lease liabilities		6,493			7,127
Total liabilities		11,532			13,619

Stockholders' equity:
Class A common stock		94			93
Class B common stock		2			2
Additional paid-in capital		201,922			201,535
Treasury stock		(2,662	)		(2,662	)
Accumulated deficit		(164,200	)		(170,114	)
Total stockholders' equity		35,156			28,854
Total liabilities and stockholders' equity	$	46,688		$	42,473

COMSTOCK HOLDING COMPANIES, INC.
Consolidated Statements of Operations
(Unaudited; In thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Revenue	$	14,463		$	12,813		$	33,705		$	30,011
Operating costs and expenses:
Cost of revenue		8,557			8,346			24,561			22,112
Selling, general, and administrative		575			537			1,711			1,393
Depreciation and amortization		74			55			212			149
Total operating costs and expenses		9,206			8,938			26,484			23,654
Income (loss) from operations		5,257			3,875			7,221			6,357
Other income (expense):
Interest expense		—			(94	)		—			(222	)
Gain (loss) on real estate ventures		(241	)		(31	)		(720	)		238
Income (loss) from continuing operations before income tax		5,017			3,751			6,549			6,375
Provision for (benefit from) income tax		332			62			635			(42	)
Net income (loss) from continuing operations		4,685			3,689			5,914			6,417
Net income (loss) from discontinued operations, net of tax		—			(99	)		—			(376	)
Net income (loss)	$	4,685		$	3,590		$	5,914		$	6,041
Impact of Series C preferred stock redemption		—			—			—			2,046
Net income (loss) attributable to common stockholders	$	4,685		$	3,590		$	5,914		$	8,087

Weighted-average common stock outstanding:
Basic		9,647			9,464			9,621			8,806
Diluted		10,130			10,007			10,082			9,363

Net income (loss) per share:
Basic - Continuing operations	$	0.49		$	0.39		$	0.61		$	0.96
Basic - Discontinued operations		—			(0.01	)		—			(0.04	)
Basic net income (loss) per share	$	0.49		$	0.38		$	0.61		$	0.92

Diluted - Continuing operations	$	0.46		$	0.37		$	0.59		$	0.90
Diluted - Discontinued operations		—			(0.01	)		—			(0.04	)
Diluted net income (loss) per share	$	0.46		$	0.36		$	0.59		$	0.86

COMSTOCK HOLDING COMPANIES, INC.

Non-GAAP Financial Measures

(Unaudited; In thousands)

Adjusted EBITDA

The following table presents a reconciliation of net income (loss) from continuing operations, the most directly comparable financial measure as measured in accordance with GAAP, to Adjusted EBITDA:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net income (loss) from continuing operations	$	4,685	$	3,689	$	5,914	$	6,417
Interest expense		—		94		—		222
Income taxes		332		62		635		(42	)
Depreciation and amortization		74		55		212		149
Stock-based compensation		273		212		777		629
(Gain) loss on equity method investments		241		31		720		(238	)
Adjusted EBITDA	$	5,605	$	4,143	$	8,258	$	7,137

We define Adjusted EBITDA as net income (loss) from continuing operations, excluding the impact of interest expense (net of interest income), income taxes, depreciation and amortization, stock-based compensation, and gain or loss on equity method investments.

We use Adjusted EBITDA to evaluate financial performance, analyze the underlying trends in our business and establish operational goals and forecasts that are used when allocating resources. We expect to compute Adjusted EBITDA consistently using the same methods each period.

We believe Adjusted EBITDA is a useful measure because it permits investors to better understand changes over comparative periods by providing financial results that are unaffected by certain non-cash items that are not considered by management to be indicative of our operational performance.

While we believe that Adjusted EBITDA is useful to investors when evaluating our business, it is not prepared and presented in accordance with GAAP, and therefore should be considered supplemental in nature. Adjusted EBITDA should not be considered in isolation, or as a substitute, for other financial performance measures presented in accordance with GAAP. Adjusted EBITDA may differ from similarly titled measures presented by other companies.

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Comstock Reports Third Quarter 2023 Results