MAYS J W INC - Quarter Report: 2019 April (Form 10-Q)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended April 30, 2019
	or
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from __________ to __________

Commission File Number 1-3647

J.W. Mays, Inc.
(Exact Name of Registrant as Specified in its Charter)

New York		11-1059070
State or Other Jurisdiction of Incorporation or Organization		I.R.S. Employer Identification No.
9 Bond Street, Brooklyn, New York		11201
Address of Principal Executive Offices		Zip Code

         (718) 624-7400         
Registrant’s Telephone Number, Including Area Code

          Not Applicable         
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒     No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒     No ☐

	Large accelerated filer ☐		Accelerated filer ☐
	Non-accelerated filer ☐		Smaller reporting company ☒
			Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☒

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act subsequent to the distribution of securities under a plan confirmed by a court. Yes ☐ No ☐

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1 par value	MAYS	NASDAQ

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class		Outstanding at June 6, 2019
Common Stock, $1 par value		2,015,780 shares
		This report contains 24 pages.

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J. W. MAYS, INC.

INDEX

		Page No.
Part I - Financial Information:
Item 1. Financial Statements
Condensed Consolidated Balance Sheets – April 30, 2019 (unaudited) and July 31, 2018		3
Condensed Consolidated Statements of Income and Retained Earnings – Three and nine months ended April 30, 2019 and 2018 (unaudited)		4
Condensed Consolidated Statements of Comprehensive Income – Three and nine months ended April 30, 2019 and 2018 (unaudited)		5
Condensed Consolidated Statements of Changes in Shareholders’ Equity – Nine months ended April 30, 2019 and 2018 (unaudited)		5
Condensed Consolidated Statements of Cash Flows – Nine months ended April 30, 2019 and 2018 (unaudited)		6
Notes to Condensed Consolidated Financial Statements		7 - 15
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations		16 - 19
Item 3. Quantitative and Qualitative Disclosures About Market Risk		19
Item 4. Controls and Procedures		19
Part II - Other Information:
Item 1. Legal Proceedings		20
Item 1A. Risk Factors		20
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		20
Item 3. Defaults Upon Senior Securities		20
Item 4. Mine Safety Disclosures		20
Item 5. Other Information		20
Item 6. Exhibits and Reports on Form 8-K		20
Signatures		21
Exhibit 31 Certifications Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.1 - Chief Executive Officer		22
31.2 - Chief Financial Officer		23
Exhibit 32 Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 18 U.S.C. Section 1350		24

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Part I - Financial Information

       Item 1 - Financial Statements

J. W. MAYS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

		April 30			July 31
ASSETS		2019			2018
		(Unaudited)			(Audited)
Property and Equipment - Net (Notes 5 and 6)		$	52,443,167		$	50,792,984
Current Assets:
Cash and cash equivalents (Notes 4 and 9)			5,330,262			5,255,073
Receivables (Note 4)			146,497			252,304
Income taxes refundable			7,683			8,792
Restricted cash			82,643			100,789
Prepaid expenses			966,681			1,951,132
Total current assets			6,533,766			7,568,090
Other Assets:
Deferred charges			3,750,454			3,228,162
Less: accumulated amortization			1,593,135			1,369,445
Net			2,157,319			1,858,717
Restricted cash			1,551,360			1,523,761
Unbilled receivables (Notes 4 and 7)			1,759,295			1,677,093
Marketable securities (Notes 3 and 4)			3,427,716			3,141,828
Total other assets			8,895,690			8,201,399
TOTAL ASSETS		$	67,872,623		$	66,562,473
LIABILITIES AND SHAREHOLDERS' EQUITY
Long-Term Liabilities:
Mortgage payable (Note 5)		$	–		$	5,264,285
Security deposits payable			1,269,981			1,242,382
Deferred income taxes (Note 1)			4,888,000			4,506,000
Total long-term liabilities			6,157,981			11,012,667
Current Liabilities:
Accounts payable			36,300			74,205
Payroll and other accrued liabilities			2,336,562			2,104,359
Other taxes payable			6,954			8,240
Current portion of mortgage payable (Note 5)			5,287,770			168,501
Current portion of security deposits payable			83,143			101,289
Total current liabilities			7,750,729			2,456,594
TOTAL LIABILITIES			13,908,710			13,469,261
Shareholders' Equity:
Common stock, par value $1 each share (shares - 5,000,000 authorized; 2,178,297 issued)			2,178,297			2,178,297
Additional paid in capital			3,346,245			3,346,245
Unrealized gain on marketable securities - net of deferred taxes of $313,000 at July 31, 2018			–			487,136
Retained earnings			49,727,223			48,369,386
			55,251,765			54,381,064
Less common stock held in treasury, at cost - 162,517 shares at April 30, 2019 and at July 31, 2018 (Note 10)			1,287,852			1,287,852
Total shareholders' equity			53,963,913			53,093,212
Contingencies (Note 12)
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$	67,872,623		$	66,562,473

See Notes to Condensed Consolidated Financial Statements.

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J. W. MAYS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS

		Three Months Ended								Nine Months Ended
		April 30								April 30
		2019				2018				2019				2018
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Revenues
Rental income (Notes 1, 4 and 7)		$	5,091,673			$	4,854,910			$	15,182,598			$	14,431,671
Recovery of real estate taxes			8,315				–				53,341				–
Total revenues			5,099,988				4,854,910				15,235,939				14,431,671
Expenses
Real estate operating expenses			2,844,624				2,918,858				8,591,284				8,491,805
Administrative and general expenses			1,135,750				1,062,316				4,184,557				3,433,154
Depreciation (Note 6)			474,761				443,697				1,414,045				1,311,386
Total expenses			4,455,135				4,424,871				14,189,886				13,236,345
Income from operations before investment income, interest expense and income taxes			644,853				430,039				1,046,053				1,195,326
Investment income and interest expense:
Investment income (Note 3)			27,377				15,909				184,488				90,131
Change in fair value of marketable securities (Notes 1 and 3)			285,426				–				143,209				–
Interest expense (Notes 5 and 9)			(31,721	)			(44,776	)			(121,049	)			(191,961	)
			281,082				(28,867	)			206,648				(101,830	)
Income from operations before income taxes			925,935				401,172				1,252,701				1,093,496
Income taxes provided (benefit)			270,000				83,000				382,000				(2,074,000	)
Net income			655,935				318,172				870,701				3,167,496
Retained earnings, beginning of period			49,071,288				48,244,569				48,369,386				45,395,245
Reclassification of unrealized gain on investments to retained earnings (Note 1)			–				–				487,136				–
Retained earnings, end of period		$	49,727,223			$	48,562,741			$	49,727,223			$	48,562,741
Income per common share (Note 2)		$	.32			$	.16			$	.43			$	1.57
Dividends per share		$	–			$	–			$	–			$	–
Average common shares outstanding			2,015,780				2,015,780				2,015,780				2,015,780

See Notes to Condensed Consolidated Financial Statements.

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J. W. MAYS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

		Three Months Ended							Nine Months Ended
		April 30							April 30
		2019			2018				2019			2018
		(Unaudited)			(Unaudited)				(Unaudited)			(Unaudited)
Net income		$	655,935		$	318,172			$	870,701		$	3,167,496
Unrealized gain (loss) on available-for-sale securities:
Unrealized gains (losses) arising during the period, net of taxes (benefit) of ($27,037) for the three months ended April 30, 2018 and $43,963 for the nine months ended April 30, 2018			–			(117,213	)			–			57,969
Reclassification adjustment for net gains included in net income, net of taxes of $7,770 for the three months ended April 30, 2018 and $7,963 for the nine months ended April 30, 2018			–			(17,630	)			–			(15,457	)
Unrealized gain (losses) on available-for-sale securities, net of taxes			–			(134,843	)			–			42,512
Comprehensive income		$	655,935		$	183,329			$	870,701		$	3,210,008

See Notes to Condensed Consolidated Financial Statements.

J.W. MAYS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)

				Additional			Unrealized Gain								Common Stock
	Common			Paid In			on Marketable				Retained				Held in
	Stock			Capital			Securities				Earnings				Treasury			Total
Balance at July 31, 2017	$	2,178,297		$	3,346,245		$	368,476			$	45,395,245			$	1,287,852		$	50,000,411
Increase in unrealized gains on marketable securities, nine months ended April 30, 2018		–			–			42,512				–				–			42,512
Net income, nine months ended April 30, 2018		–			–			–				3,167,496				–			3,167,496
Balance at April 30, 2018		2,178,297			3,346,245			410,988				48,562,741				1,287,852			53,210,419
Increase in unrealized gains on marketable securities, three months ended July 31, 2018		–			–			76,148				–				–			76,148
Net loss, three months ended July 31, 2018		–			–			–				(193,355	)			–			(193,355	)
Balance at July 31, 2018		2,178,297			3,346,245			487,136				48,369,386				1,287,852			53,093,212
Reclassification of unrealized gains on marketable securities to retained earnings (Note 1)		–			–			(487,136	)			487,136				–			–
Net income, nine months ended April 30, 2019		–			–			–				870,701				–			870,701
Balance at April 30, 2019	$	2,178,297		$	3,346,245		$	–			$	49,727,223			$	1,287,852		$	53,963,913

See Notes to Condensed Consolidated Financial Statements

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J. W. MAYS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

		Nine Months Ended
		April 30
		2019				2018
		(Unaudited)				(Unaudited)
Cash Flows From Operating Activities:
Net income		$	870,701			$	3,167,496
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			1,414,045				1,311,386
Amortization of deferred charges			223,690				222,600
Deferred finance costs included in interest expense			17,156				17,154
Net realized and unrealized (gain) loss on sale of marketable securities			(189,625	)			805
Other assets - unbilled receivables			(82,202	)			204,016
- deferred charges			(522,292	)			(20,488	)
Deferred income taxes			382,000				(2,063,000	)
Changes in:
Receivables			105,807				101,563
Income taxes refundable			1,109				(40,369	)
Prepaid expenses			984,451				721,673
Accounts payable			(37,905	)			(60,703	)
Payroll and other accrued liabilities			232,203				(660,481	)
Other taxes payable			(1,286	)			(1,835	)
Cash provided by operating activities			3,397,852				2,899,817
Cash Flows From Investing Activities:
Acquisition of property and equipment			(3,064,228	)			(1,831,066	)
Marketable securities:
Receipts from sales			219,744				268,857
Payments for purchases			(316,007	)			(98,340	)
Cash (used) by investing activities			(3,160,491	)			(1,660,549	)
Cash Flows From Financing Activities:
Increase - security deposits payable			9,453				297,653
Mortgage and other debt payments			(162,172	)			(121,238	)
Cash provided (used) by financing activities			(152,719	)			176,415
Increase in cash and cash equivalents			84,642				1,415,683
Cash, cash equivalents and restricted cash at beginning of period			6,879,623				6,676,929
Cash, cash equivalents and restricted cash at end of period (Note 9)		$	6,964,265			$	8,092,612

See Notes to Condensed Consolidated Financial Statements.

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J. W. MAYS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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New York State and New York City taxes are calculated using the higher of taxes based on income or the respective capital-based franchise taxes. Beginning with the Company’s tax year ended July 31, 2016, changes in the law required the state capital-based tax will be phased out over a 7-year period. During the quarter ended July 31, 2018, the Company recorded a state deferred tax asset, deferred tax liability and deferred taxes on unrealized gain on marketable securities in the amounts of $790,000, $1,430,000 and $53,000, respectively, resulting in a state deferred tax expense of $587,000. New York City taxes will be based on capital for the foreseeable future. Capital-based franchise taxes are recorded to administrative and general expense. State tax amounts in excess of the capital-based franchise taxes are recorded to income tax expense. Due to both the application of the capital-based tax and due to the possible absence of city taxable income, the Company does not record city deferred taxes. The decrease in the effective tax rate for the nine months ended April 30, 2019 as compared with the nine months ended April 30, 2018 was primarily attributable to the permanent reduction in federal tax rates from 34% to 21%, partially offset by New York State taxes. Recently adopted accounting standards: In May 2014, the Financial Accounting Standards Board (“FASB”), issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” (“ASU 2014-09”) establishing ASC Topic 606 Revenue from Contracts with Customers. ASU 2014-09 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. ASU 2014-09 is effective for interim and annual reporting in fiscal years that begin after December 15, 2016. ASU 2015-14 extended the implementation date for fiscal years beginning after December 31, 2017. Subsequent to the issuance of ASU 2014-09, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)”, ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing”, ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, and ASU No. 2016-20, "Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers." The additional ASU's clarified certain provisions of ASU 2014-09 in response to recommendations from the Transition Resource Group established by the FASB and have the same effective date and transition requirements as ASU 2014-09. We adopted these standards effective August 1, 2018 using the modified retrospective approach, which allows us to apply the new standard to all existing contracts not yet completed as of the effective date and record a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption, however there was no cumulative-effect required to be recognized in our retained earnings as the date of adoption. The adoption of this standard did not have a material impact on our consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01 "Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities." ASU 2016-01 amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments, including the requirement to measure certain equity investments at fair value with changes in fair value recognized in net income. ASU No. 2016-01 is effective for interim and annual periods beginning after December 15, 2017. We adopted this standard effective August 1, 2018 and recorded a cumulative effect adjustment to increase opening retained earnings at August 1, 2018 by $487,136 as required for equity investments recorded at fair value, formerly available-for-sale securities. In November 2016, the FASB issued ASU 2016-18, “Restricted Cash”. ASU 2016-18 requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning of period and end of period balances on the statement of cash flows upon adoption of this standard. ASU 2016-18 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. We adopted this standard effective August 1, 2018 with retrospective application to our consolidated financial statements.

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In February 2018, the FASB issued ASU No. 2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”, to address a specific consequence of the Tax Act by allowing a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Act’s reduction of the U.S. federal corporate income tax rate. The standard is effective for all entities for annual periods beginning after December 15, 2018, with early adoption permitted, and is to be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act is recognized. The Company early adopted this ASU effective August 1, 2018 and applied this new guidance in the period of adoption. As a result, $92,000 of income taxes stranded in accumulated other comprehensive income (loss) was classified to retained earnings. The ASU also requires the Company to disclose its policy on accounting for income tax effects in accumulated other comprehensive income (loss). In general, the Company applies the individual item approach with respect to marketable securities. In August 2018, the U.S. Securities and Exchange Commission ("SEC") adopted final rules under SEC Release No. 33-10532, Disclosure Update and Simplification, amending and expanding certain disclosure requirements. The rules require, among other things, that registrants include in their interim financial statements a reconciliation of changes in shareholders' equity in the notes or as a separate statement that reconciles the beginning balance to the ending balance of each caption in shareholders' equity for each period for which an income statement is required to be filed. The Company applied the new SEC disclosure requirements to the Consolidated Statements of Changes in Shareholders' Equity in the third quarter of fiscal 2019 on a retrospective basis. Recently issued accounting standards not yet adopted: In February 2016, the FASB issued ASU 2016-02, “Leases.” ASU 2016-02 is intended to increase transparency and comparability among organizations in accounting for leasing arrangements. This guidance establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Lessor accounting remains similar to the current model, but updated to align with certain changes to the lessee model and the new revenue recognition standard (ASU 2014-09). ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. Entities will be required to recognize and measure leases as of the earliest period presented using a modified retrospective approach. In July 2018, the FASB issued ASU No. 2018-10, “Codification Improvements to Topic 842”, which provides amendments and clarification to ASU 2016-12 based on the FASB’s interaction with stakeholders. In July 2018, the FASB issued ASU No. 2018-11 “Leases (Topic 842): Targeted Improvements”, which amends Leases (Topic 842) to (i) add an optional transition method that would permit entities to apply the new requirements by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the year of adoption, and (ii) provide a practical expedient for lessors regarding the separation of the lease and non-lease components of a contract. In December 2018, the FASB issued ASU No. 2018-20, “Leases (Topic 842) Narrow-Scope Improvement for Lessors,” which clarifies how to apply the leases standard when accounting for sales taxes and other similar taxes collected from lessees, certain lessor costs, and recognition of variable payments for contracts with lease and non-lease components. In March 2019, the FASB issued ASU 2019-01, “Leases (Topic 842) Codification Improvements”, which provides amendments for issues brought to the Board’s attention through its interactions with stakeholders. The issues identified are as follows. 1. Determining the fair value of the underlying asset by lessors that are not manufacturers or dealers, 2. Presentation on the statement of cash flows-sales-type and direct financing leases, 3. Transition disclosures related to Topic 250, Accounting Changes and Error Corrections. These standards are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new standards will be effective for the Company for the fiscal year beginning August 1, 2019, with early adoption permitted, and the Company expects to use the cumulative-effect adjustment approach in the year of adoption. The adoption of this guidance is expected to result in an increase in assets and liabilities on the Company’s balance sheet, with no material impact on the statement of income. However, the ultimate impact of adopting this ASU will depend on the Company’s lease portfolio as of the adoption date.

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2.	Income Per Share of Common Stock:
	Income per share has been computed by dividing the net income for the periods by the weighted average number of shares of common stock outstanding during the periods, adjusted for the purchase of treasury stock. Shares used in computing income per share were 2,015,780 for the three and nine months ended April 30, 2019 and April 30, 2018.
3.	Marketable Securities:
	The Company’s marketable securities consist of investments in equity securities. Dividends and interest income are accrued as earned. Realized gains and losses are determined on a specific identification basis. The Company reviews marketable securities for impairment whenever circumstances and situations change such that there is an indication that the carrying amounts may not be recovered. Prior to August 1, 2018, unrealized gains and losses resulting from changes in the fair value of these securities were included in “other comprehensive income”. Effective August 1, 2018, the changes in the fair value of these securities are recognized in current period earnings in accordance with ASC 825. The Company follows GAAP which establishes a fair value hierarchy that prioritizes the valuation techniques and creates the following three broad levels, with Level 1 valuation being the highest priority: Level 1 valuation inputs are quoted market prices in active markets for identical assets or liabilities that are accessible at the measurement date (e.g., equity securities traded on the New York Stock Exchange). Level 2 valuation inputs are from other than quoted market prices included in Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted market prices of similar assets or liabilities in active markets, or quoted market prices for identical or similar assets or liabilities in markets that are not active). Level 3 valuation inputs are unobservable (e.g., an entity’s own data) and should be used to measure fair value to the extent that observable inputs are not available. Following is a description of the valuation methodologies used for assets measured at fair value on a recurring basis. There have been no changes in the methodologies used at April 30, 2019 and July 31, 2018. Equity securities are valued at the closing price reported on the active market on which the individual securities are traded that the Company has access to. Mutual funds are valued at the daily closing price as reported by the fund. Mutual funds held by the Company are open-end mutual funds that are registered with the Securities and Exchange Commission. These funds are required to publish their daily net asset value (“NAV”) and to transact at that price. The mutual funds held by the Company are deemed to be actively traded.

In accordance with the provisions of Fair Value Measurements, the following are the Company's financial assets measured on a recurring basis presented at fair value.

Fair value measurements at reporting date

		Total												Total
		April 30,												July 31,
Description		2019			Level 1			Level 2			Level 3			2018			Level 1			Level 2			Level 3
Assets:
Marketable securities		$	3,427,716		$	3,427,716		$	–		$	–		$	3,141,828		$	3,141,828		$	–		$	–

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As of April 30, 2019 and July 31, 2018, the Company's marketable securities were classified as follows:

		April 30, 2019												July 31, 2018
					Gross			Gross									Gross			Gross
					Unrealized			Unrealized			Fair						Unrealized			Unrealized			Fair
		Cost			Gains			Losses			Value			Cost			Gains			Losses			Value
Noncurrent:
Mutual funds		$	844,106		$	233,546		$	–		$	1,077,652		$	774,602		$	237,149		$	–		$	1,011,751
Equity securities			1,640,264			709,800			–			2,350,064			1,567,089			562,988			–			2,130,077
		$	2,484,370		$	943,346		$	–		$	3,427,716		$	2,341,691		$	800,137		$	–		$	3,141,828

Investment income consists of the following:

4.	Financial Instruments and Credit Risk Concentrations:
	Financial instruments that are potentially subject to concentrations of credit risk consist principally of marketable securities, cash and cash equivalents and receivables. Marketable securities and cash and cash equivalents are placed with multiple financial institutions and multiple instruments to minimize risk. No assurance can be made that such financial institutions and instruments will minimize all such risk. The Company derives rental income from approximately fifty tenants, of which one tenant accounted for 18.22%, another tenant accounted for 14.40% and a third tenant accounted for 11.81% of rental income during the nine months ended April 30, 2019. The nine months ended April 30, 2018 had one tenant account for 17.70%, another tenant account for 15.33% and a third tenant account for 12.25% of rental income. No other tenant accounted for more than 10% of rental income during the same periods.
5.	Long-Term Debt – Mortgage:

On January 9, 2015, the Company refinanced its loan with a bank for $6,000,000, which included the outstanding balance as of January 2015 in the amount of $5,347,726 and an additional borrowing of $652,274. The loan is for a period of five years with a payment based on a twenty-five year amortization period. The interest rate for this period is fixed at 3.54% per annum. The mortgage loan is secured by the Bond Street building in Brooklyn, New York. The Company is in the process of refinancing the loan with a bank for an additional five years.

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6.	Property and Equipment – at cost:

The Company has committed to construct four new elevators in the Company’s Fishkill, New York building. The cost will be approximately $1,800,000 and is anticipated to be completed in the fall of 2019.

7.	Unbilled Receivables and Rental Income:
	Unbilled receivables represent the excess of scheduled rental income recognized on a straight-line basis over rental income as it becomes receivable according to the provisions of each lease.

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8.	Employees' Retirement Plan:
	The Company sponsors a noncontributory Money Purchase Plan covering substantially all of its non-union employees. Operations were charged $106,580 and $359,353 as contributions to the Plan for the three and nine months ended April 30, 2019, respectively, and $82,308 and $311,145 as contributions to the plan for the three and nine months ended April 30, 2018, respectively.
	Multi-employer plan:
	The Company contributes to a union sponsored multi-employer pension plan covering its union employees. The Company contributions to the pension plan were $16,327 and $45,786 for the three and nine months ended April 30, 2019, respectively, and $14,963 and $49,119 as contributions to the plan for the three and nine months ended April 30, 2018, respectively. Contributions and costs are determined in accordance with the provisions of negotiated labor contracts or terms of the plans. The Company also contributes to union sponsored health benefit plans.
	Contingent Liability for Pension Plan:
	Information as to the Company’s portion of accumulated plan benefits and plan assets is not reported separately by the pension plan. Under the Employee Retirement Income Security Act, upon withdrawal from a multi-employer benefit plan, an employer is required to continue to pay its proportionate share of the plan’s unfunded vested benefits, if any. Any liability under this provision cannot be determined: however, the Company has not made a decision to withdraw from the plan.
	Information for contributing employer’s participation in the multi-employer plan:

	Legal name of Plan:		United Food and Commercial
			Workers Local 888 Pension Fund
	Employer identification number:		13-6367793
	Plan number:		001
	Date of most recent Form 5500:		December 31, 2017
	Certified zone status:		Critical and declining status
	Status determination date:		January 1, 2018
	Plan used extended amortization provisions in status calculation:		Yes
	Minimum required contribution:		Yes
	Employer contributing greater than 5% of Plan contributions for year ended December 31, 2017:		Yes
	Rehabilitation plan implemented:		Yes
	Employer subject to surcharge:		Yes
	Contract expiration date:		November 30, 2019

For the plan years 2017-2019, under the pension fund’s rehabilitation plan, the Company agreed to pay a minimum contribution rate equal to 9.1% of the prior year total contribution rate. The Company has 29 employees and has a contract, expiring November 30, 2019, with a union covering rates of pay, hours of employment and other conditions of employment for approximately 24% of its employees. The Company considers that its labor relations with its employees and union are good.

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9.	Cash Flow Information:
	For purposes of reporting cash flows, the Company considers cash equivalents to consist of short-term highly liquid investments with maturities of three (3) months or less, which are readily convertible into cash. The following is a reconciliation of the Company’s cash and cash equivalents and restricted cash to the total presented on the consolidated statement of cash flows:

Amounts in restricted cash primarily consist of cash held in bank accounts for tenant security deposits, amounts set aside in accordance with certain loan agreements, and security deposits with landlords and utility companies.

10.	Common Stock:
	The Company has one class of common stock with identical voting rights and rights to liquidation.

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11.	Accumulated Other Comprehensive Income:
	The only component of accumulated other comprehensive income is unrealized gain (loss) on marketable securities.
	A summary of the changes in accumulated other comprehensive income for the three and nine months ended April 30, 2019 and 2018 is as follows:

	A summary of the line items in the Condensed Consolidated Statements of Income and Retained Earnings affected by the amounts reclassified from accumulated other comprehensive income is as follows:

	Details about accumulated other comprehensive income components		Affected line item in the statement where net income is presented
	----------------------------------------------------		---------------------------------------------
	Other comprehensive income reclassified tax effect		Investment income Income taxes provided

12.	Contingencies:
	On November 2, 2018 the Company settled the lawsuit relating to defective workmanship and breach of contract to replace a roof and various other work on its Fishkill, New York building. The Company agreed to pay $635,000 to the Plaintiffs, D. Owens Electric, Inc., Mid-Hudson Structural Concrete, Inc. d/b/a Recycle Depot, and BSB Construction, Inc., in settlement of the claims made against the Company. This settlement resolves the actions and disputes referred to in the Decision and Order dated October 30, 2018 of the Supreme Court of the State of New York, County of Duchess. The $635,000 was paid in full on November 6, 2018.
	There are various other lawsuits and claims pending against the Company. It is the opinion of management that the resolution of these matters will not have a material adverse effect on the Company’s Consolidated Financial Statements.
	If the Company sells, transfers, disposes of or demolishes 25 Elm Place, Brooklyn, New York, then the Company may be liable to create a condominium unit for the loading dock. The necessity of creating the condominium unit and the cost of such condominium unit cannot be determined at this time.

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Item 2.

J. W. MAYS, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our financial statements and related notes thereto contained in this report. In this discussion, the words “Company”, “we”, “our” and “us” refer to J.W. Mays, Inc. and subsidiaries.

Forward Looking Statements:

The following can be interpreted as including forward looking statements under the Private Securities Litigation Reform Act of 1995. The words “outlook”, “intend”, “plans”, “efforts”, “anticipates”, “believes”, “expects” or words of similar import typically identify such statements. Various important factors that could cause actual results to differ materially from those expressed in the forward-looking statements are identified under the heading “Cautionary Statement Regarding Forward-Looking Statements” below. Our actual results may vary significantly from the results contemplated by these forward-looking statements based on a number of factors including, but not limited to, availability of labor, marketing success, competitive conditions and the change in economic conditions of the various markets we serve.

Critical Accounting Policies and Estimates:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosure of contingent assets and liabilities. We believe the critical accounting policies in Note 1 to the Condensed Consolidated Financial Statements disclose our more significant judgments and estimates used in the preparation of our financial statements. Actual results may differ from these estimates under different assumptions and conditions. (See Note 1 on pages 7 through 9 to the Condensed Consolidated Financial Statements herein and Note 1 on pages 9 through 12 to the Consolidated Financial Statements in the Annual Report to Shareholders for the fiscal year ended July 31, 2018).

Results of Operations:

Three months ended April 30, 2019 compared to the three months ended April 30, 2018:

In the three months ended April 30, 2019, the Company reported net income of $655,935, or $.32 per share. In the comparable three months ended April 30, 2018, the Company reported net income of $318,172, or $.16 per share.

Revenues in the current three months increased to $5,099,988 from $4,854,910 in the comparable 2018 three months primarily due to increased rental income from existing tenants and a real estate tax refund from the Company’s Massapequa, New York property.

Real estate operating expenses in the current three months decreased to $2,844,624 from $2,918,858 in the comparable 2018 three months primarily due to decreases in maintenance costs, partially offset by increases in payroll costs and leasing commission expense.

Administrative and general expenses in the current three months increased to $1,135,750 from $1,062,316 in the comparable 2018 three months primarily due to increases in payroll costs, pension costs and legal and professional costs.

Depreciation expense in the current three months increased to $474,761 from $443,697 in the comparable 2018 three months primarily due to improvements in the Brooklyn, Jamaica and Fishkill, New York buildings.

Investment income exceeded interest expense in the current three months by $281,082 and interest expense exceeded investment income by $28,867 in the comparable 2018 three months.

Nine months ended April 30, 2019 compared to the nine months ended April 30, 2018:

In the nine months ended April 30, 2019, the Company reported net income of $870,701, or $.43 per share. In the comparable nine months ended April 30, 2018, the Company reported net income of $3,167,496, or $1.57 per share. The decrease was primarily due to the enactment of the U.S. Tax Act on December 22, 2017. These changes required an adjustment to our deferred tax assets and liabilities to the lower federal rates resulting in an estimated net tax benefit of approximately $2.4 million in the nine months ended April 30, 2018.

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Revenues in the current nine months increased to $15,235,939 from $14,431,671 in the comparable 2018 nine months primarily due to increased rental income from existing tenants and a real estate tax refund from the Company’s Levittown and Massapequa, New York properties.

Real estate operating expenses in the current nine months increased to $8,591,284 from $8,491,805 in the comparable 2018 nine months primarily due to increases in real estate taxes, payroll costs, leasing commission expense and rent expense partially offset by a decrease in maintenance costs, and utility costs.

Administrative and general expenses in the current nine months increased to $4,184,557 from $3,433,154 in the comparable 2018 nine months primarily due to the settlement of litigation cost in the amount of $635,000 (see Note 12), increases in payroll costs and pension costs.

Depreciation expense in the current nine months increased to $1,414,045 from $1,311,386 in the comparable 2018 nine months primarily due to improvements in the Brooklyn, Jamaica and Fishkill, New York buildings.

Investment income exceeded interest expense in the current nine months by $206,648 and interest expense exceeded investment income by $101,830 in the comparable 2018 nine months.

As explained above, the enactment of the U.S. Tax Act required an adjustment to our deferred tax assets and liabilities for the nine months ended April 30, 2018 to the lower federal rates resulting in an estimated net federal tax benefit of approximately $2.4 million. Income taxes provided (benefit) for the nine months ended April 30, 2018 was approximately $2.1 million.

Liquidity and Capital Resources:

Management considers current working capital and borrowing capabilities adequate to cover the Company’s planned operating and capital requirements. The Company’s cash and cash equivalents amounted to $5,330,262 at April 30, 2019. The Company is in the process of refinancing its loan with a bank in the amount of $5,341,439 for an additional five years.

In March 2017, the Company leased 7,700 square feet to a medical facility at its Nine Bond Street Brooklyn, New York building, for a term of ten years with two five year option periods. To accommodate this tenant, an existing tenant surrendered 400 square feet of retail space. The cost of renovations for this tenant will be approximately $400,000 and brokerage commissions were $216,052. The tenant is anticipated to take occupancy and commence payment of rent in the fall of 2019.

In August, 2018, the Company entered into a lease agreement with an existing office tenant for an additional 1,849 square feet until June 30, 2022 at its Nine Bond Street Brooklyn, New York building.

In October 2018, the Company extended a lease with a retail tenant who occupies 47,100 square feet at its Jamaica, New York building for a period of ten years to expire on May 31, 2029.

In October 2018, the Company extended the lease with its landlord, who is a related party, at its Jamaica, New York building for a period of one year and ten months to expire on May 31, 2029.

In October 2018, the Company extended a lease with an office tenant who occupies 38,109 square feet at its Jamaica, New York building for an additional four years expiring November 30, 2022.

In October 2018, the Company extended a lease with one of the Company’s landlords, which expires in April 2021 for an additional ten years to expire in April 2031 at its Nine Bond Street Brooklyn, New York building.

In January 2019, the Company extended a lease with an office tenant who occupies 700 square feet at its Nine Bond Street Brooklyn, New York building, for an additional five years expiring January 31, 2024.

In March 2019, the Company extended a lease with an office tenant who occupies 13,451 square feet at its Nine Bond Street Brooklyn, New York building whose lease expires July 31, 2021, for an additional five years expiring July 31, 2026.

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The tenant who leased 20,000 square feet of area at the Company’s Massapequa, New York property to open a restaurant had their lease terminated in April 2019 for non-payment of rent. The tenant’s lease commenced in September 2018 and rent was supposed to begin in January 2019. The annual loss in rent would have been $72,000.

Cash Flows From Operating Activities:

Deferred Expenses: The Company had an additional $521,592 for brokerage commissions incurred due to a tenant extending their lease for an additional ten years at the Company’s Jamaica, New York building.

Payroll and Other Accrued Liabilities: The Company had a balance due at April 30, 2019 for brokerage commissions of $503,884.

Provision (Benefit) for Deferred Income Taxes: Enactment of the U.S. Tax Act on December 22, 2017, as explained above, resulted in an estimated net federal tax benefit of approximately $2.4 million in the three month period ended April 30, 2018. Although the adjustment increased the Company’s net income, it did not increase cash. To reconcile net income to net cash provided by operating activities, provision (benefit) for deferred income taxes was a benefit of approximately $2.1 million for the nine months ended April 30, 2018 compared to an expense of approximately $.4 million for the comparable 2019 nine months.

Cash Flows From Investing Activities:

The Company had expenditures of $85,274 for the nine months ended April 30, 2019 for boiler upgrades at the Company’s Nine Bond Street building in Brooklyn, New York. The Company also had expenditures of $190,091 for renovations for an existing tenant. The total cost of the project will be approximately $300,000 and was completed in May 2019. The Company also had expenditures of $194,079 for façade work and $180,120 for stairwell work.

The Company had expenditures for elevator upgrade work in the amount of $85,061 for the nine months ended April 30, 2019, at the Company’s Jamaica, New York building. The total cost of the project was $864,460, and was completed in August, 2018. The Company had expenditures of $592,671 for renovation work for an existing tenant. The total cost of the project is estimated to be approximately $700,000, and is anticipated to be completed in July 2019.

The Company had expenditures for parking lot lights in the amount of $111,698 for the nine months ended April 30, 2019, at its Fishkill, New York building. The total cost was $234,862 and was completed in August 2018. The Company also had expenditures of $397,597 for windows. The cost of the project was $1,026,364 and was completed in November 2018. The Company also had expenditures of $657,013 for four new elevators. The cost will be approximately $1,800,000 and is anticipated to be completed in the fall of 2019. The Company also had expenditures of $123,396 for a new lobby. The cost will be approximately $1,500,000 and is anticipated to be completed in September 2019. The Company also had expenditures of $65,171 for various other construction projects.

The Company had expenditures in the amount of $105,369 for stairwell work and $190,330 for steel work at its Jowein building in Brooklyn, New York. The Company also had expenditures of $60,531 for a new HVAC system for an existing tenant. The total cost of the system will be approximately $300,000 and is anticipated to be completed in June 2019.

Cautionary Statement Regarding Forward-Looking Statements:

This section, Management’s Discussion and Analysis of Financial Condition and Results of Operations, other sections of this Report on Form 10-Q and other reports and verbal statements made by our representatives from time to time may contain forward-looking statements that are based on our assumptions, expectations and projections about us and the real estate industry. These include statements regarding our expectations about revenues, our liquidity, our expenses and our continued growth, among others. Such forward-looking statements by their nature involve a degree of risk and uncertainty. We caution that a variety of factors, including but not limited to the factors listed below, could cause business conditions and our results to differ materially from what is contained in forward-looking statements:

●	changes in the rate of economic growth in the United States;
●	the ability to obtain credit from financial institutions and the related costs;
●	changes in the financial condition of our customers;
●	changes in regulatory environment;
●	lease cancellations;

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●	changes in our estimates of costs;
●	war and/or terrorist attacks on facilities where services are or may be provided;
●	outcomes of pending and future litigation;
●	increasing competition by other companies;
●	compliance with our loan covenants;
●	recoverability of claims against our customers and others by us and claims by third parties against us; and
●	changes in estimates used in our critical accounting policies.

Other factors and assumptions not identified above were also involved in the formation of these forward-looking statements and the failure of such other assumptions to be realized, as well as other factors, may also cause actual results to differ materially from those projected. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described above in connection with any forward-looking statements that may be made by us.

We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to review any additional disclosures we make in proxy statements, quarterly reports on Form 10-Q, annual reports on Form 10-K and any Form 8-K reports filed with the United States Securities and Exchange Commission.

Item 3. Quantitative and Qualitative Disclosures About Market Risk:

The Company uses fixed-rate debt to finance its capital requirements. These transactions do not expose the Company to market risk related to changes in interest rates. The Company does not use derivative financial instruments. At April 30, 2019, the Company had fixed-rate debt of $5,341,439.

Item 4. Controls and Procedures:

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”)) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded, as of the end of the period covered by this quarterly report, our disclosure controls and procedures were effective and provide reasonable assurance that the information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported accurately and within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting during the period covered by this report that have materially affected, or are likely to materially affect, our internal control over financial reporting.

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Part II - Other Information

(b) Reports on Form 8-K – One report on Form 8-K was filed by the registrant for the period ended April 30, 2019.

Item reported:

The Company reported its financial results for the three months and six ended January 31, 2019.
Date of report filed – March 7, 2019.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

					J.W. MAYS, Inc.
					(Registrant)
Date:	June 6, 2019				Lloyd J. Shulman
					Lloyd J. Shulman
					President
					Chief Executive Officer
Date:	June 6, 2019				Mark S. Greenblatt
					Mark S. Greenblatt
					Vice President
					Chief Financial Officer

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