##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-KANNUAL REPORT

Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

For the fiscal year ended April 30, 2002

Commission file number 0-10146

ABRAMS INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)

|                                                                                   |  |                                                
|---------------------------------------------------------------------------------- |  | -----------------------------------------------
|Georgia
(State or other jurisdiction of
incorporation or organization)             |  | 58-0522129
(I.R.S. Employer
Identification No.)
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   |  |                                                
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|1945 The Exchange, Suite 300, Atlanta, GA
(Address of principal executive offices) |  | 30339-2029
(Zip Code)                          

Registrants telephone number, including area code: (770) 953-0304

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

|                     |  |                                           
|-------------------- |  | ------------------------------------------
|Title of each class: |  | Name of each exchange on
which registered:
|                    
|                    
|                    
|                    
|None                 |  | None                                      

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

Common Stock, $1.00 Par Value Per Share
(Title of Class)

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 (Check Box)      NO (Box)

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained to the
best of the Registrants knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. (Box)

The aggregate market value of the voting stock held by nonaffiliates of the
registrant as of June 14, 2002, was $7,250,362. See Part III. The number of
shares of Common Stock of the registrant outstanding as of June 14, 2002, was
2,909,079.

DOCUMENTS INCORPORATED BY REFERENCE

The information called for by Part III (Items 10, 11, 12, and 13) is
incorporated herein by reference to the registrants definitive proxy statement
for the 2002 Annual Meeting of Shareholders which is to be filed pursuant to
Regulation 14A.





---

TABLE OF CONTENTS



|                                                  |                                                                                                                                                 |  |  |  |  |  |  | 
|------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I                                           
|                                                  | ITEM 1 BUSINESS                                                                                                                                
|                                                  | ITEM 2 PROPERTIES                                                                                                                              
|                                                  | ITEM 3 LEGAL PROCEEDINGS                                                                                                                       
|                                                  | ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                                                     
|PART II                                          
|                                                  | ITEM 5 MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED SHAREHOLDER MATTERS                                                                   
|                                                  | ITEM 6 SELECTED FINANCIAL DATA                                                                                                                 
|                                                  | ITEM 7 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR FISCAL YEARS ENDED APRIL 30,2002,2001,AND 2000
|                                                  | ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                                             
|                                                  | ITEM 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                                                             
|PART III                                         
|                                                  | ITEMS 10-13                                                                                                                                    
|                                                  | ITEM 14 EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.                                                                      
|EX-13 ANNUAL REPORT TO SHAREHOLDERS              
|EX-21 LIST OF THE COMPANY'S SUBSIDIARIES         
|EX-23(a) CONSENT OF DELOITTE & TOUCHE LLP        
|EX-23(b) CONSENT OF PRICEWATERHOUSECOOPERS LLP   
|EX-99 PROXY STATEMENT FOR THE 2002 ANNUAL MEETING



---



##### Table of Contents






PART I




ITEM 1   BUSINESS

Abrams Industries, Inc. engages in (i) construction of retail and commercial
projects; (ii) investment in income-producing properties, including
acquisition, development, re-development and sale; and (iii) energy management.
As used herein, the term Company refers to Abrams Industries, Inc. and its
subsidiaries and predecessors, unless the context indicates otherwise, and the
term Parent or Parent Company refers solely to Abrams Industries, Inc.
Prior to fiscal year 2001, the Company engaged in the asset and property
management of properties in which it had an ownership or leasehold interest.

In May 2001, the Company created a third operating segment by acquiring
the operating assets of another company. Abrams Power, Inc., through its
subsidiary, Servidyne Systems, LLC, offers its U.S. and international
institutional customers an array of state-of-the-art strategies to reduce
energy consumption, labor, equipment maintenance, and capital costs in
commercial buildings, using a comprehensive approach that combines its suite of
specialized services, sophisticated energy efficiency products and engineering
services.

The Company was organized under Delaware law in 1960 to succeed to the
business of A. R. Abrams, Inc., which was founded in 1925 by Alfred R. Abrams
as a sole proprietorship. In 1984, the Company changed its state of
incorporation from Delaware to Georgia.

Financial information for the operating segments is set forth in Note 14
to the Consolidated Financial Statements of the Company.

CONSTRUCTION SEGMENT

The Company, through its wholly owned subsidiary, Abrams Construction, Inc.,
has engaged in the construction business since 1925. Although the Company does
work throughout much of the United States, it concentrates its activities
principally in the southern and midwestern states. Construction activities
consist primarily of new construction, expansion, and remodeling of retail
store buildings, banks, shopping centers, warehouses, distribution centers, and
other commercial buildings.

Construction contracts are obtained by competitive bid and by negotiation.
Generally, the Company purchases materials and services for its
construction operations on a project-by-project basis.

REAL ESTATE SEGMENT

The Company, through its wholly owned subsidiary, Abrams Properties, Inc.,
has engaged in real estate activities since 1960. Historically, these
activities involved the acquisition, development, redevelopment, leasing,
management, ownership, and sale of shopping centers, industrial
facilities, and office buildings in the Southeast and Midwest. During
fiscal 2001, the Company outsourced to third parties the asset and
property management functions related to its real estate portfolio.

The Company currently owns six shopping centers, four that the Company
developed and two that it acquired. In June 2002, the Company sold its
shopping center located in Englewood, Florida. This center was classified as
Property held for sale as of April 30, 2002. See Notes 5 and 19 to the
Consolidated Financial Statements of the Company. The remaining centers are
held as long-term investments. See ITEM 2. PROPERTIES  Owned Shopping
Centers. The Company is also currently lessee and sublessor of seven
Company-developed shopping centers that were sold, leased back by the Company,
and subleased to Kmart. See ITEM 2. PROPERTIES  Leaseback Shopping Centers.
During fiscal 2002, pursuant to its filing for protection under Chapter 11 of
the U.S. Bankruptcy Code, Kmart terminated its subleases for another two of the
Companys leasebacks. The Company subsequently terminated its leasehold
interests in these two properties. See ITEM 2. PROPERTIES. The Company also
owns a vacant former metal manufacturing facility located in Atlanta, Georgia,
and two office properties. See ITEM 2. PROPERTIES  Office Buildings.

ENERGY MANAGEMENT SEGMENT

In fiscal 2002, the Company began operations of a new segment, Energy
Management, through its wholly owned subsidiary, Abrams Power, Inc. On May 9,
2001, the Company purchased substantially all of the assets of Servidyne
Systems, Inc., an energy engineering and energy management company.

The primary focus for the business is the continental United States,
although the Company does perform services for some international customers.
The Company assists its customers in reducing energy consumption and operating
costs of commercial buildings by providing: (1) engineering services; (2)
equipment maintenance and labor productivity management; and (3) utility cost
management. Energy engineering contracts are primarily obtained through
negotiations, but may also be obtained through competitive bids on larger
proposals.

EMPLOYEES AND EMPLOYEE RELATIONS

At April 30, 2002, the Company employed 89 salaried employees and 3 hourly
employees. On its construction jobs, the Company utilizes local labor whenever
practicable, paying the prevailing wage scale. The Company believes that its
relations with its employees are good.

SEASONAL NATURE OF BUSINESS

The Companys business historically has been somewhat seasonal, with the
Construction Segment affected by weather conditions and its retail customers
store opening schedules. The Companys exposure to weather conditions is
limited to some extent by operating in several regions of the country, with
substantial operations in the southern United States where favorable weather
conditions prevail for most of the year. Generally, fewer retailers open stores
in the winter months, and new store construction usually is scheduled to be
completed prior to the winter season. The businesses of the Real Estate and
Energy Management Segments are generally less seasonal.

COMPETITION

The businesses of the Company are highly competitive. In the Construction
Segment, the Company competes with a large number of national and local
construction companies, many of which have greater financial resources than the
Company or proprietary customer relationships. The Real Estate Segment also
operates in a competitive environment, with numerous parties competing
for available financing, properties, tenants and investors. The Energy
Management Segments competition is widespread and ranges from multinational
to local small businesses.

4



---



##### Table of Contents



PRINCIPAL CUSTOMERS

During fiscal 2002, the Company derived approximately 56% ($65,821,944) of
its Consolidated revenues from continuing operations from direct
transactions with The Home Depot, Inc. and approximately 18% ($21,461,660) from
direct transactions with Academy Sports & Outdoors. These revenues resulted
principally from construction activities. See Note 14 to the Consolidated
Financial Statements of the Company. No other single customer accounted for 10%
or more of the Companys consolidated revenues during the year.

Kmart is an anchor tenant in three of the Companys six owned shopping
centers and in seven leaseback locations. Of the approximately
$13.2 million in rental revenues earned by the Real Estate Segment in fiscal
2002, approximately $4.9 million was attributable to Kmart Corporation,
including approximately $523,000 from the Kmart store located in the
Companys shopping center in Englewood, Florida, which was sold in June 2002,
and approximately $466,000 from the two leaseback locations that were
terminated during 2002. See Note 18 to the Consolidated Financial Statements
of the Company.

BACKLOG

The following table indicates the backlog of contracts, expected rentals and
real estate sales for the next twelve months by industry segment:

|                                 |  |           |            |           |  |   |            | 
|-------------------------------- |  | --------- | ---------- | --------- |  | - | ---------- | 
|                                 |  | April 30, |            | April 30,
|                                 |  | 2002      |            | 2001     
|                                 |  |           |            |          
|Construction-contracts (1)       |  | $         | 15,178,000 |           |  | $ | 55,565,000 | 
|                                
|                                
|                                
|                                
|Real Estate-rental income (2)    |  |           | 9,331,000  |           |  |   | 11,346,000 | 
|                                
|                                
|                                
|                                
|Real Estate-sales (2)            |  |           | 14,000,000 |           |  |   | 195,000    | 
|                                
|                                
|                                
|                                
|Energy Management-
contracts (3) |  |           | 519,000    |           |  |   |           | 
|                                 |  |           |            |           |  |   |            | 
|Total Backlog                    |  | $         | 39,028,000 |           |  | $ | 67,106,000 | 
|                                 |  |           |            |           |  |   |            | 



|(1) |  | See Note 1 to Chart A under ITEM 7. RESULTS OF OPERATIONS concerning
the decrease in backlog of Construction contracts.                                                                                                                                                                                                                                                                                                                                                 
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Included in the backlog of Real Estate-rental income at April 30, 2001, is
rent of approximately $1,715,000 from the shopping center in Englewood,
Florida, which was sold in June 2002, and approximately $552,000 related to the
two Kmart leaseback subleases that were terminated during fiscal 2002. See
ITEM 2. PROPERTIES. The backlog of Real Estate-sales for 2002 represents the
contract to sell the Englewood shopping center. The sale closed in June 2002.
|   
|   
|   
|   
|(3) |  | Any Energy Management contracts that can be cancelled with less than one
years notice are not included in backlog. As of April 30, 2002, such
contracts total $1,136,000 in potential revenue over the next twelve months,
assuming cancellation provisions are not invoked.                                                                                                                                                                                             

The Company estimates that most of the backlog at April 30,
2002, will be completed prior to April 30, 2003. No assurance can be
given as to future backlog levels or whether the Company will realize
earnings from revenues resulting from the backlog at April 30, 2002.

REGULATION

The Company is subject to the authority of various federal, state and
local regulatory agencies concerned with its construction operations,
including among others, the Occupational Health and Safety
Administration and the Environmental Protection Agency. The
Company is also subject to local zoning regulations and building
codes in performing its construction and real estate activities.
Management believes that it is in substantial compliance with all such
governmental regulations. Management believes that compliance
with federal, state and local provisions, which have been enacted or
adopted for regulating the discharge of materials into the
environment, does not have a material effect upon the capital
expenditures, earnings and competitive position of the Company.

EXECUTIVE OFFICERS OF THE REGISTRANT

The Executive Officers of the Company as of April 30, 2002,
were as follows:

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                   
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------
|Alan R. Abrams(47)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | Officer since 1988
|Co-Chairman of the Board since 1998, and a Director of the
Company since 1992, he has been Chief Executive Officer since 1999
and President since 2000. From 1998 to 1999, he was President and
Chief Operating Officer. He served as Executive Vice President of the
Company from 1997 to 1998. He also has served as President and
Chief Executive Officer of Servidyne Systems, LLC since May 2002.
From 1994 to 1998 he served as President, and from 1997 to 1998 as
Chief Executive Officer of Abrams Properties, Inc.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Melinda S. Garrett(46)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Officer since 1990
|Director of the Company since 1999, she has been Chief Financial
Officer since 1997. She also has served Abrams Properties, Inc. as
President since 2001, Chief Financial Officer from 1998 to 2000,
and Vice President from 1993 to 2000.                                                                                                                                                                                                                                                                                   | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|B. Michael Merritt(52)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Officer since 1986
|Director of the Company since 2000, he has served Abrams
Construction, Inc. as Chief Executive Officer since 2001 and
President since 1995.                                                                                                                                                                                                                                                                                                                                                                                  |  |                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|J. Andrew Abrams(42)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | Officer since 1988
|Co-Chairman of the Board since 1998, and a Director of the
Company since 1992, he has been Vice President-Business
Development since 2000, and served as President and Chief
Operating Officer from 1999 to 2000. From 1997 to 1999, he was
Executive Vice President. He also has served as Chief Executive
Officer of Abrams Fixture Corporation since 1997.                                                                                                                                                                |  |                   

Executive Officers of the Company are elected by the Board
of Directors of the Company or the Board of Directors of the
respective subsidiary to serve at the pleasure of the Board. Alan R.
Abrams and J. Andrew Abrams are brothers, and are the sons of
Edward M. Abrams, a member of the Board of Directors and
Chairman of the Executive Committee of the Board of Directors.
David L. Abrams, a member of the Board of Directors, is first
cousin to Alan R. Abrams and J. Andrew Abrams, and nephew to
Edward M. Abrams. There are no other family relationships
between any Executive Officer or Director and any other
Executive Officer or Director of the Company.

5



---



##### Table of Contents






ITEM 2   PROPERTIES

The Company, through its Real Estate Segment, owns its corporate
headquarters building, which contains approximately 66,000
square feet of office space. The building is located in the North X
Northwest Office Park, 1945 The Exchange, in suburban Atlanta,
Georgia. The Parent Company, Real Estate Segment, and
Construction Segment are located in this building. In addition to
the 23,750 square feet of offices occupied by Abrams entities,
another 37,863 square feet is leased to unrelated tenants, and
4,267 square feet is currently available for lease.

In fiscal 2000, the Company sold its shopping center located
in Newnan, Georgia. The sale was structured as a tax-deferred,
like-kind exchange pursuant to Internal Revenue Code Section
1031, which allows a deferral of the tax gain if the Company
utilizes the proceeds of the sale to purchase other real estate. The
Company subsequently acquired a shopping center in
Jacksonville, Florida, as the replacement property. See ITEM 7.
LIQUIDITY AND CAPITAL RESOURCES for discussion
regarding the transactions.

The Company received notice in fiscal 2000 from the Georgia
State Properties Commission that the Georgia World Congress
Center Authority had made the determination to acquire the
Companys former wood manufacturing facility in Atlanta,
Georgia. A Special Master appointed by the court awarded the
Company $4.5 million for the property, which amount was paid to
the Company. Both the State and the Company appealed the
award amount. At April 30, 2001, the deferred pre-tax gain of
approximately $2.8 million related to the sale of the facility was
included in Net liabilities of discontinued operations. In October
2001, a settlement was reached and the Company recognized
Earnings from discontinued operations, net of taxes, of
approximately $1.7 million on the transaction.

In April 2000, the Companys former manufacturing plant
located in Lithia Springs, Georgia, which was developed and owned
by the Real Estate Segment, was sold at a gain. The Company
continues to own a vacant former metal manufacturing facility
located in Atlanta, Georgia.

In May 2001, the Company, through its Energy
Management Segment, assumed a lease for 7,418 square feet of
office space located at 1350 Spring Street, NW, in midtown
Atlanta, Georgia, as part of its acquisition of the assets of
Servidyne Systems, Inc.

In January 2002, Kmart Corporation filed for protection
under Chapter 11 of the U.S. Bankruptcy Code. At that time,
four of the Companys seven owned retail properties contained
stores leased to Kmart, two of which were freestanding stores. In
June 2002, the Company sold at a gain its Englewood shopping
center, which is co-anchored by Kmart. See Note 19 to the
Consolidated Financial Statements. The remaining three Kmart
locations owned by the Company are currently open and
operating. Seven freestanding Kmart stores that the Company
developed, sold, leased back, and then subleased to Kmart, are
currently open and operating. Kmart, pursuant to its rights
under Chapter 11, terminated its subleases of the Companys
two former leaseback properties in Louisville, Kentucky,
and West St. Paul, Minnesota, and the Company
subsequently terminated its leasehold interests for both properties.

In March 2002, Kmart published a list of stores that it would
close. None of the open stores leased or subleased to
Kmart by the Company was on the list. The Bankruptcy Court has
not provided the Company any further information as to whether
any additional Kmart stores might be closed or which leases will be
rejected or affirmed. Prior to publishing its store-closing list, Kmart
contacted the Company to request a reduction in rent for one
leaseback location. The Company denied the request, Kmart has
continued to pay full rent, and the store remains open. This
location generated approximately $46,000 in pre-tax earnings in
fiscal 2002, and the Company has no capitalized costs related to
this location. In April 2002, Kmart exercised a five-year option to
extend its sublease on another one of the Companys leaseback
locations. This location produced approximately $26,000 in pre-
tax earnings in fiscal 2002.

The Company owns, or has an interest in, the following
properties:

OWNED SHOPPING CENTERS

As of April 30, 2002, the Companys Real Estate Segment owned
five shopping centers that it developed and two that it acquired.
The following chart provides relevant information relating to the
owned shopping centers:

6



---



##### Table of Contents



|                       |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            |           |  | 
|---------------------- |  | ----- | ---- | ----------- |  | ---------- | ------- | --------- |  | ---------- |  | -------- | --------- | -------- |  | --------------- | --------- | ---- |  | ---- | --------- |  |  | --------- | ---------- | --------- |  | 
|                       |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            | Principal
|                       |  |       |      |             |  |            |         |           |  | Calendar   |  |          |           |          |  |                 |           |      |  |      |           |  |  | Amount of
|                       |  |       |      |             |  | Leasable   |         | Year(s)   |  |            |  |          |           |          |  |                 |           | Debt |  | Debt
|                       |  |       |      |             |  | Square     |         | Placed in |  | Rental     |  | Cash     |           | Service  |  | Outstanding    
|                       |  |       |      |             |  | Feet in    |         | Service   |  | Income     |  | Flow     |           | Payments |  | as of April 30,
|Location               |  | Acres |      | Building(s) |  | by Company |         | 2002      |  | 2002 (1)   |  | 2002 (2) |           | 2002 (3)
|                      
|1100 W. Argyle Street  |  |       | 10.5 |             |  |            | 110,046 |           |  | 1972, 1996 |  | $        | 547,600   |          |  | $               | 408,310   |      |  | $    | 397,010   |  |  | $         | 2,904,984  |          
|Jackson, MI            |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            |           |  | 
|                      
|1075 W. Jackson Street |  |       | 7.3  |             |  |            | 92,120  |           |  | 1980, 1992 |  |          | 603,173   |          |  |                 | 474,418   |      |  |      | 405,883   |  |  |           | 2,686,604  |          
|Morton, IL (4)         |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            |           |  | 
|                      
|2500 Airport Thruway   |  |       | 8.0  |             |  |            | 87,543  |           |  | 1980, 1988 |  |          | 439,620   |          |  |                 | 398,104   |      |  |      | 391,565   |  |  |           | 1,929,425  |          
|Columbus, GA (4)(5)    |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            |           |  | 
|                      
|1500 Placida Road      |  |       | 28.7 |             |  |            | 213,739 |           |  | 1990       |  |          | 1,959,747 |          |  |                 | 1,448,871 |      |  |      | 1,352,168 |  |  |           | 12,206,700 |          
|Englewood, FL (6)      |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            |           |  | 
|                      
|15201 N. Cleveland     |  |       | 72.3 |             |  |            | 293,801 |           |  | 1993, 1996 |  |          | 2,853,752 |          |  |                 | 1,983,792 |      |  |      | 1,558,106 |  |  |           | 12,319,969 |          
|North Ft. Myers, FL    |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            |           |  | 
|                      
|5700 Harrison Avenue   |  |       | 10.8 |             |  |            | 86,396  |           |  | 1998       |  |          | 485,527   |          |  |                 | 301,478   |      |  |      |          |  |  |           |           |          
|Cincinnati, OH (7)     |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            |           |  | 
|                      
|8106 Blanding Blvd     |  |       | 18.8 |             |  |            | 174,220 |           |  | 1999       |  |          | 1,515,555 |          |  |                 | 1,375,380 |      |  |      | 1,280,156 |  |  |           | 8,864,793  |          
|Jacksonville, FL (8)   |  |       |      |             |  |            |         |           |  |            |  |          |           |          |  |                 |           |      |  |      |           |  |  |           |            |           |  | 
|                      



|(1) |  | Cash flow is defined as net operating income before the following:
depreciation, amortization of loan and lease costs, interest and
principal payments on mortgage notes or other debt.                                                                                                    
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Includes principal and interest.                                                                                                                                                                                                                                                           
|   
|   
|   
|   
|(3) |  | Exculpatory provisions limit the Companys liability for repayment to the
respective mortgaged properties, except for the loan in
North Ft. Myers, Florida, which has been guaranteed by Abrams Properties,
Inc. See Notes 8 and 9 to the Consolidated Financial
Statements of the Company.
|   
|   
|   
|   
|(4) |  | Land is leased, not owned.                                                                                                                                                                                                                                                                 
|   
|   
|   
|   
|(5) |  | The center in Columbus, Georgia, is owned by Abrams-Columbus Limited
Partnership, in which Abrams Properties, Inc. serves as
general partner and owns an 80% interest.                                                                                                                     
|   
|   
|   
|   
|(6) |  | Property was sold in June 2002 at a gain.                                                                                                                                                                                                                                                  
|   
|   
|   
|   
|(7) |  | Originally completed by others in 1982.                                                                                                                                                                                                                                                    
|   
|   
|   
|   
|(8) |  | Originally completed by others in 1985.                                                                                                                                                                                                                                                    

The two centers located in Morton, Illinois, and Columbus, Georgia, are
leased exclusively to Kmart. The Kmart lease in Columbus,
Georgia, expires in 2008 and has ten five-year renewal options, and the Kmart
lease in Morton, Illinois, expires in 2016 and has eight
five-year renewal options. Anchor lease terms for other centers are shown in
the following table:

|                    |  |                      |  |         |         |            |  |       |      |       |  |                     |  |  |  | 
|------------------- |  | -------------------- |  | ------- | ------- | ---------- |  | ----- | ---- | ----- |  | ------------------- |  |  |  | 
|                    |  |                      |  |         |         |            |  |       |      | Lease |  | Options            
|                    |  | Anchor               |  | Square  |         | Expiration |  | to   
|Location            |  | Tenant (1)           |  | Footage |         | Date       |  | Renew
|                   
|Jackson, MI         |  | Big Lots             |  |         | 26,022  |            |  |       | 2007 |       |  | 2 for 5 years each 
|                    |  | Kroger               |  |         | 63,024  |            |  |       | 2021 |       |  | 6 for 5 years each 
|                   
|North Ft. Myers, FL |  | AMC                  |  |         | 54,805  |            |  |       | 2016 |       |  | 4 for 5 years each 
|                    |  | Beall's              |  |         | 35,600  |            |  |       | 2009 |       |  | 9 for 5 years each 
|                    |  | Kash n' Karry        |  |         | 33,000  |            |  |       | 2013 |       |  | 4 for 5 years each 
|                    |  | Jo-Ann Fabrics       |  |         | 16,000  |            |  |       | 2004 |       |  | 3 for 5 years each 
|                    |  | Kmart                |  |         | 107,806 |            |  |       | 2018 |       |  | 10 For 5 years each
|                   
|Cincinnati, OH      |  | Kroger (2)           |  |         | 42,456  |            |  |       | 2005 |       |  | 3 For 5 years each 
|                    |  | Harbor Freight Tools |  |         | 12,000  |            |  |       | 2009 |       |  | 2 For 5 years each 
|                   
|Jacksonville, FL    |  | Publix (2)           |  |         | 85,560  |            |  |       | 2010 |       |  | 6 For 5 years each 
|                    |  | Office Depot         |  |         | 22,692  |            |  |       | 2003 |       |  | 3 For 5 years each 
|                   



|(1) |  | A tenant is considered to be an Anchor Tenant if it leases 12,000
square feet or more of space, and has
an initial lease term in excess of five years.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Tenant has vacated the premises, but remains responsible for lease
payments until the expiration date.                                                  

7



---



##### Table of Contents



With the exception of the Kmart lease in Columbus, Georgia, and the Harbor
Freight Tools lease in Cincinnati, Ohio, all of the anchor
tenant and many of the small shop leases provide for contingent rentals if
sales exceed specified amounts. In fiscal 2002, the Company received
$78,808 in contingent rentals, net of offsets, which amounts are included in
the aggregate rentals set forth above. The Company also is owed
$61,140 in additional contingent rent in relation to the Kmart in Morton,
Illinois. Kmart is treating this amount as a pre-bankruptcy petition
amount and has therefore not made payment. The Company is making a claim for
payment to the Bankruptcy Court, and has set up a
reserve for the entire disputed amount as of April 30, 2002.

Typically, tenants are responsible for their pro rata share of ad valorem
taxes, insurance and common area maintenance (subject to the
right of offset mentioned above). Kmart has total maintenance responsibility
for the centers in Morton, Illinois, and Columbus, Georgia.

LEASEBACK SHOPPING CENTERS

The Company, through its Real Estate Segment, has a leasehold interest in seven
shopping centers that it developed, sold, and leased back
under leases expiring from years 2003 to 2014. The centers are subleased by the
Company to Kmart Corporation, and the Company has
the ability to lease the properties for periods corresponding with the Kmart
subleases. (See previous discussion regarding Kmart in this
ITEM 2. above.) The Kmart subleases provide for contingent rentals if sales
exceed specified amounts, and contain ten five-year renewal
options, except Jacksonville, Florida, which has eight five-year renewal
options and Davenport, Iowa, which has nine five-year renewal
options remaining after Kmart exercised one five-year option in fiscal 2002.
The Companys leases with the fee owners contain renewal
options coextensive with Kmarts renewal options.

Kmart is responsible for insurance and ad valorem taxes, but has the right
to offset against contingent rentals any such taxes paid in
excess of specified amounts. In fiscal 2002, the Company received $95,495 in
contingent rentals, net of offsets, which amounts are included
in the aggregate annual rentals set forth below. The Company has responsibility
for structural and roof maintenance of the buildings. The
Company also has responsibility for parking lots and driveways, except routine
upkeep, which is the responsibility of the subtenant, Kmart.
The Companys leases contain exculpatory provisions, which limit the Companys
liability for payment to its interest in the respective leases.

The following chart provides certain information relating to the leaseback
shopping centers:

|                  |  |       |      |             |  |            |         |                   |  |        |            |         |  |   |         |  |  |   |         | 
|----------------- |  | ----- | ---- | ----------- |  | ---------- | ------- | ----------------- |  | ------ | ---------- | ------- |  | - | ------- |  |  | - | ------- | 
|                  |  |       |      |             |  | Square     |         | Calendar Years    |  | Rental |            | Rent   
|                  |  |       |      |             |  | Feet in    |         | Placed in Service |  | Income |            | Expense
|Location          |  | Acres |      | Building(s) |  | by Company |         | 2002              |  | 2002  
|                 
|Bayonet Point, FL |  |       | 10.8 |             |  |            | 109,340 |                   |  |        | 1976, 1994 |         |  | $ | 384,400 |  |  | $ | 269,564 | 
|                 
|Orange Park, FL   |  |       | 9.4  |             |  |            | 84,180  |                   |  |        | 1976       |         |  |   | 264,000 |  |  |   | 226,796 | 
|                 
|Davenport, IA     |  |       | 10.0 |             |  |            | 84,180  |                   |  |        | 1977       |         |  |   | 268,179 |  |  |   | 205,645 | 
|                 
|Minneapolis, MN   |  |       | 7.1  |             |  |            | 84,180  |                   |  |        | 1978       |         |  |   | 351,144 |  |  |   | 232,626 | 
|                 
|Ft. Smith, AR     |  |       | 9.2  |             |  |            | 106,141 |                   |  |        | 1979, 1994 |         |  |   | 255,350 |  |  |   | 223,195 | 
|                 
|Jacksonville, FL  |  |       | 11.6 |             |  |            | 97,032  |                   |  |        | 1979       |         |  |   | 303,419 |  |  |   | 258,858 | 
|                 
|Richfield, MN     |  |       | 5.7  |             |  |            | 74,217  |                   |  |        | 1979       |         |  |   | 300,274 |  |  |   | 241,904 | 
|                 

OFFICE BUILDINGS

The Company, through its Real Estate Segment, owns two office properties: the
corporate headquarters building located at 1945 The
Exchange, Atlanta, Georgia, and an office park in northwest suburban Atlanta,
Georgia. The following chart provides pertinent information
relating to the office buildings:

8



---



##### Table of Contents



|                           |  |       |      |             |  |          |         |            |  |          |      |         |  |          |           |                 |  |      |           |      |  |   |         |           |  |           |           | 
|-------------------------- |  | ----- | ---- | ----------- |  | -------- | ------- | ---------- |  | -------- | ---- | ------- |  | -------- | --------- | --------------- |  | ---- | --------- | ---- |  | - | ------- | --------- |  | --------- | --------- | 
|                           |  |       |      |             |  |          |         |            |  |          |      |         |  |          |           |                 |  |      |           |      |  |   |         |           |  | Principal
|                           |  |       |      |             |  |          |         |            |  | Calendar |      |         |  |          |           |                 |  |      |           |      |  |   |         | Amount of
|                           |  |       |      |             |  | Leasable |         | Year       |  |          |      |         |  |          |           |                 |  | Debt |           | Debt
|                           |  |       |      |             |  | Square   |         | Placed in  |  | Rental   |      | Cash    |  | Service  |           | Outstanding    
|                           |  |       |      |             |  | Feet in  |         | Service by |  | Income   |      | Flow    |  | Payments |           | as of April 30,
|Location                   |  | Acres |      | Building(s) |  | Company  |         | 2002       |  | 2002(1)  |      | 2002(2) |  | 2002    
|                          
|1945 The Exchange          |  |       | 3.12 |             |  |          | 65,880  |            |  |          | 1997 |         |  | $        | 1,149,549 |                 |  | $    | 707,787   |      |  | $ | 505,699 |           |  | $         | 4,596,683 | 
|Atlanta, GA (3)            |  |       |      |             |  |          |         |            |  |          |      |         |  |          |           |                 |  |      |           |      |  |   |         |           |  |           |           | 
|                          
|1501-1523 Johnson Ferry Rd |  |       | 8.82 |             |  |          | 121,476 |            |  |          | 1997 |         |  |          | 1,726,398 |                 |  |      | 1,053,601 |      |  |   | 538,925 |           |  |           | 6,213,142 | 
|Marietta, GA (4)           |  |       |      |             |  |          |         |            |  |          |      |         |  |          |           |                 |  |      |           |      |  |   |         |           |  |           |           | 
|                          



|(1) |  | Cash flow is defined as net operating income before the following:
depreciation, amortization of loan and lease costs, interest and
principal payments on mortgage notes and other debt.                                                                                                                                                                                                                                                                                                                                                                                  
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Includes principal and interest.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   
|   
|   
|   
|(3) |  | Corporate headquarters building of which the Parent Company, Real Estate
Segment, and Construction Segment occupy
approximately 23,750 square feet. Rental income and cash flow includes
intercompany rent at market rates of $461,818 paid by the
Parent Company and the Construction Segment. Abrams Properties, Inc.
guaranteed the debt outstanding at April 30, 2002. See
ITEM 7. LIQUIDITY AND CAPITAL RESOURCES for additional discussion
regarding new financing. Originally constructed
by others in 1974 and acquired and re-developed by the Company in 1997.
|   
|   
|   
|   
|(4) |  | The Company, through a subsidiary of its Real Estate Segment, is the
lessee of 10,661 square feet of space under a master lease
agreement to satisfy a condition required by the lender. Rental income
and cash flow include intercompany rent at market rates of
$233,833 paid by the Real Estate Segment. Originally completed by others
in 1980 and 1985.                                                                                                                                                                                                              

LAND LEASED OR HELD FOR FUTURE DEVELOPMENT OR SALE

The Company, through its Real Estate Segment, owns or has an interest in the
following land leased or held for future development or sale:

|                                               |  |       |      |           |  |               |           |          |  |                                                  |  | 
|---------------------------------------------- |  | ----- | ---- | --------- |  | ------------- | --------- | -------- |  | ------------------------------------------------ |  | 
|                                               |  |       |      |           |  | Calendar Year |           |          |  |                                                 
|                                               |  |       |      |           |  | Development   |           | Intended
|Location                                       |  | Acres |      | Completed |  | Use (1)      
|                                              
|W. Argyle StreetJackson, MI                    |  |       | 0.9  |           |  |               | 1972,1996 |          |  | One outlot or retail shops                      
|                                              
|Kimberly Road & Fairmont StreetDavenport, IA   |  |       | 6.0  |           |  |               | 1977      |          |  | Food store and/or retail shops and outlot       
|                                              
|Dixie HighwayLouisville, KY                    |  |       | 4.7  |           |  |               | 1979      |          |  | Food store and/or retail shops                  
|                                              
|West 15th StreetWashington, NC (2)             |  |       | 1.4  |           |  |               | 1979      |          |  | Two outlots                                     
|                                              
|Mundy Mill RoadOakwood, GA                     |  |       | 5.3  |           |  |               | 1987      |          |  | Commercial development pad or up to four outlots
|                                              
|North Cleveland AvenueNorth Fort
Myers, FL (3) |  |       | 11.6 |           |  |               | 1993      |          |  | Five outlots, anchor pads and retail shops      
|                                              



|(1) |  | Outlot as used herein refers to a small parcel of land reserved from the
shopping center parcel and is generally sold for, leased for, or
developed as a fast-food operation, bank or similar use.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Leased under leases terminating in years 2005 and 2010 with a right to
extend for three additional five-year periods. Both outlots are
subleased for terms coextensive with the Companys lease.    
|   
|   
|   
|   
|(3) |  | One outlot, not included above, was sold at a gain during fiscal 2002.                                                                                                                              

There is no debt on any of the above properties, except for the North Ft.
Myers, Florida, anchor pad and retail shop land. See Note 9
to the Consolidated Financial Statements of the Company. The Company will
either develop the properties described above or will
continue to hold them for sale or lease to others.




ITEM 3   LEGAL PROCEEDINGS

The Company is not a party to, nor is any of its property the subject of, any
pending legal proceedings which are likely, in the opinion of
management, to have a material, adverse effect on the Companys operations or
financial condition.




ITEM 4   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.

9



---



##### Table of Contents






PART II




ITEM 5   MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

|               |  |                       |       |             |  |             |       |             |  |   |       |  |  |   |       |  |  |                |      |  |  |   |      | 
|-------------- |  | --------------------- | ----- | ----------- |  | ----------- | ----- | ----------- |  | - | ----- |  |  | - | ----- |  |  | -------------- | ---- |  |  | - | ---- | 
|               |  |                       |       |             |  |             |       |             |  |   |       |  |  |   |       |  |  | DIVIDENDS PAID
|               |  | CLOSING MARKET PRICES |       | PER SHARE  
|               |  |                       |       |            
|               |  | FISCAL 2002           |       | FISCAL 2001 |  | FISCAL 2002 |       | FISCAL 2001
|               |  |                       |       |             |  |             |       |            
|               |  | HIGH                  |       | LOW         |  | HIGH        |       | LOW         |  |   |       |  |  |   |       | 
|               |  | TRADE                 |       | TRADE       |  | TRADE       |       | TRADE       |  |   |       |  |  |   |       | 
|               |  |                       |       |             |  |             |       |             |  |   |       |  |  |   |       | 
|First Quarter  |  | $                     | 4.240 |             |  | $           | 3.400 |             |  | $ | 4.313 |  |  | $ | 3.125 |  |  | $              | .040 |  |  | $ | .040 | 
|              
|Second Quarter |  |                       | 4.200 |             |  |             | 3.800 |             |  |   | 4.000 |  |  |   | 3.438 |  |  |                | .040 |  |  |   | .040 | 
|              
|Third Quarter  |  |                       | 3.900 |             |  |             | 3.630 |             |  |   | 4.469 |  |  |   | 3.625 |  |  |                | .040 |  |  |   | .040 | 
|              
|Fourth Quarter |  |                       | 5.310 |             |  |             | 3.650 |             |  |   | 4.125 |  |  |   | 3.438 |  |  |                | .040 |  |  |   | .040 | 
|              

The common stock of Abrams Industries, Inc. is traded on the NASDAQ National
Market System (Symbol: ABRI). The approximate
number of holders of common stock was 455 (including shareholders of record and
shares held in street name) at May 31, 2002.

The information contained under the heading Equity Compensation Plan in
the Companys definitive proxy materials for its 2002
Annual Meeting of Shareholders will be filed with the Securities and Exchange
Commission under a separate filing, and is hereby
incorporated by reference.




ITEM 6   SELECTED FINANCIAL DATA

The following table sets forth selected financial data for the Company and
should be read in conjunction with the Consolidated Financial
Statements and the notes thereto:

|                                                               |  |      |             |      |  |      |             |      |  |      |             |   |  |   |             |   |  |   |             | 
|-------------------------------------------------------------- |  | ---- | ----------- | ---- |  | ---- | ----------- | ---- |  | ---- | ----------- | - |  | - | ----------- | - |  | - | ----------- | 
|Years Ended April 30,                                          |  | 2002 |             | 2001 |  | 2000 |             | 1999 |  | 1998
|                                                              
|Net Earnings (Loss) (1)                                        |  | $    | 811,774     |      |  | $    | 676,172     |      |  | $    | (456,605    | ) |  | $ | (676,031    | ) |  | $ | 2,999,478   | 
|                                                              
|Net Earnings (Loss)
Per Share (1)                              |  | $    | .28         |      |  | $    | .23         |      |  | $    | (.16        | ) |  | $ | (.23        | ) |  | $ | 1.02        | 
|                                                              
|Consolidated Revenues -
Continuing Operations                  |  | $    | 117,597,687 |      |  | $    | 154,606,987 |      |  | $    | 174,579,492 |   |  | $ | 172,201,090 |   |  | $ | 163,586,356 | 
|                                                              
|Net Earnings (Loss) -
Continuing Operations                    |  | $    | (908,975    | )    |  | $    | 376,325     |      |  | $    | 2,367,190   |   |  | $ | (39,599     | ) |  | $ | 2,694,211   | 
|                                                              
|Net Earnings (Loss) Per Share -
Continuing Operations          |  | $    | (.31        | )    |  | $    | .13         |      |  | $    | .80         |   |  | $ | (.01        | ) |  | $ | .92         | 
|                                                              
|Shares Outstanding at Year End                                 |  |      | 2,909,079   |      |  |      | 2,943,303   |      |  |      | 2,936,356   |   |  |   | 2,936,356   |   |  |   | 2,936,356   | 
|                                                              
|Cash Dividends Paid Per Share                                  |  | $    | .16         |      |  | $    | .16         |      |  | $    | .16         |   |  | $ | .20         |   |  | $ | .19         | 
|                                                              
|Shareholders Equity                                           |  | $    | 22,778,876  |      |  | $    | 22,505,543  |      |  | $    | 22,346,138  |   |  | $ | 23,272,560  |   |  | $ | 24,535,863  | 
|                                                              
|Shareholders Equity Per Share                                 |  | $    | 7.83        |      |  | $    | 7.65        |      |  | $    | 7.61        |   |  | $ | 7.93        |   |  | $ | 8.36        | 
|                                                              
|Working Capital                                                |  | $    | 10,028,188  |      |  | $    | 11,442,348  |      |  | $    | 10,820,179  |   |  | $ | 9,885,902   |   |  | $ | 15,283,031  | 
|                                                              
|Depreciation and Amortization
Expense  Continuing Operations  |  | $    | 3,164,886   |      |  | $    | 2,761,764   |      |  | $    | 3,067,959   |   |  | $ | 2,702,555   |   |  | $ | 2,338,854   | 
|                                                              
|Total Assets                                                   |  | $    | 90,940,883  |      |  | $    | 97,619,685  |      |  | $    | 102,845,867 |   |  | $ | 126,132,540 |   |  | $ | 121,309,444 | 
|                                                              
|Income-Producing Properties and
Property and Equipment,net (2) |  | $    | 45,188,295  |      |  | $    | 28,134,764  |      |  | $    | 61,456,455  |   |  | $ | 64,680,003  |   |  | $ | 67,119,159  | 
|                                                              
|Long-Term Debt                                                 |  | $    | 35,163,492  |      |  | $    | 50,180,619  |      |  | $    | 51,929,637  |   |  | $ | 56,554,488  |   |  | $ | 62,938,807  | 
|                                                              
|Return on Average Shareholders
Equity  Continuing Operations |  |      | (4.0)%      |      |  |      | 1.7%        |      |  |      | 10.4%       |   |  |   | (0.2)%      |   |  |   | 11.5%       | 
|                                                              
|Return on Average
Shareholders
Equity (1)                     |  |      | 3.6%        |      |  |      | 3.0%        |      |  |      | (2.0)%      |   |  |   | (2.8)%      |   |  |   | 12.9%       | 
|                                                              



|(1) |  | Includes continuing operations, discontinued operations, and extraordinary
item, if any.   
|--- |  | -------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Does not include Property held for sale or Real estate held for future
development or sale.

10



---



##### Table of Contents






ITEM 7     MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF   OPERATIONS
FOR FISCAL YEARS ENDED APRIL 30, 2002, 2001, AND 2000


RESULTS OF OPERATIONS

REVENUES
Revenues from continuing operations for 2002 were $117,597,687 compared to
$154,606,987 and $174,579,492 for 2001 and 2000,
respectively. This represents decreases in Revenues of 24% in 2002 and 12% in
2001. Revenues include Interest income of $181,255,
$480,771, and $372,524, for 2002, 2001, and 2000, respectively, and Other
income of $90,418, $51,030, and $73,882, for 2002, 2001,
and 2000, respectively. The figures in Chart A below, however, do not include
Interest income, Other income or Intersegment revenues.
When more than one segment is involved, Revenues are reported by the segment
that sells the product or service to an unaffiliated purchaser.

REVENUES FROM CONTINUING OPERATIONS SUMMARY BY SEGMENT

CHART A
(Dollars in Thousands)

|                      |  |             |         |            |  |             |         |            |  |      |         |      |  |        |     |         |  |   |         |  |  |   |         |  |  |   |         |   |  |  |     |  
|--------------------- |  | ----------- | ------- | ---------- |  | ----------- | ------- | ---------- |  | ---- | ------- | ---- |  | ------ | --- | ------- |  | - | ------- |  |  | - | ------- |  |  | - | ------- | - |  |  | --- | -
|                      |  | Years Ended |         | Increase   |  | Years Ended |         | Increase  
|                      |  | April 30,   |         | (Decrease) |  | April 30,   |         | (Decrease)
|                      |  |             |         |            |  |             |         |           
|                      |  | 2002        |         | 2001       |  | Amount      |         | Percent    |  | 2001 |         | 2000 |  | Amount |     | Percent
|                      |  |             |         |            |  |             |         |            |  |      |         |      |  |        |     |        
|Construction (1)      |  | $           | 100,688 |            |  | $           | 141,118 |            |  | $    | (40,430 | )    |  |        | (29 | )       |  | $ | 141,118 |  |  | $ | 143,916 |  |  | $ | (2,798  | ) |  |  | (2  | )
|                     
|                     
|                     
|                     
|Real Estate (2)       |  |             | 13,643  |            |  |             | 12,957  |            |  |      | 686     |      |  |        | 5   |         |  |   | 12,957  |  |  |   | 30,217  |  |  |   | (17,260 | ) |  |  | (57 | )
|                     
|                     
|                     
|                     
|Energy Management (3) |  |             | 2,995   |            |  |             |        |            |  |      | 2,995   |      |  |        |    |         |  |   |        |  |  |   |        |  |  |   |        |   |  |  |    |  
|                      |  |             |         |            |  |             |         |            |  |      |         |      |  |        |     |         |  |   |         |  |  |   |         |  |  |   |         |   |  |  |     |  
|Total                 |  | $           | 117,326 |            |  | $           | 154,075 |            |  | $    | (36,749 | )    |  |        | (24 | )       |  | $ | 154,075 |  |  | $ | 174,133 |  |  | $ | (20,058 | ) |  |  | (12 | )
|                      |  |             |         |            |  |             |         |            |  |      |         |      |  |        |     |         |  |   |         |  |  |   |         |  |  |   |         |   |  |  |     |  

NOTES:



|(1) |  | The decrease in revenue in 2002 from that in 2001 was primarily
attributable to a reduction in the number of construction jobs available
in a very competitive marketplace, which is a result of a marked
deceleration in capital spending by retail companies. In such an
environment, management elected to reduce revenue volume rather than
pursuing certain jobs at prices that offered unacceptable levels
of potential profitability. The Company anticipates this trend will
continue in the short-term. During fiscal 2002, however, several new
institutional customers awarded jobs to the Construction Segment, as the
Company continues its efforts to expand and diversify its
customer base.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Rental revenues for 2002 were $13,178,263, compared to $12,956,875 in 2001
and $12,551,729 in 2000. Rental revenues exclude
$461,818 in 2002, $388,960 in 2001, and $1,527,856 in 2000 received from
the Companys other segments. Revenues from sales of
real estate were $465,000 in 2002, from the sale of an outlot in North Ft.
Myers, Florida, and $17,665,456 in 2000, from the sales of
the Companys shopping center in Newnan, Georgia, and the Companys
manufacturing facility in Lithia Springs, Georgia. There were
no sales of real estate in 2001. The Company reviews its real estate
portfolio on an ongoing basis, and places a property on the market
for sale when it believes it is in its best interests to do so. In
addition, a property may be marketed in one fiscal year, but a potential sale
may not close until a subsequent year, due to market conditions or
individually negotiated contract terms. Real estate sales, which may
have a material impact on the Companys net earnings, do not occur every
year, and the Company cannot predict the timing of any such
sales. Rental revenues in fiscal 2002 included $4,867,309, representing
approximately 37% of total Rental revenues, attributable to
Kmart Corporation. See ITEM 2. PROPERTIES for discussion of Kmart
Corporations Chapter 11 bankruptcy filing.
|   
|   
|   
|   
|(3) |  | The Energy Management Segment was formed in May 2001. See Note 16 to the
Consolidated Financial Statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

COST AND EXPENSES: APPLICABLE TO REVENUES
As a percentage of total Segment Revenues (See Chart A), the applicable total
Segment Costs and Expenses (See Chart B) of $107,183,006
for 2002, $139,075,402 for 2001, and $155,731,989 for 2000, were 91%, 90%, and
89%, respectively.

11



---



##### Table of Contents



COSTS AND EXPENSES: APPLICABLE TO REVENUES FROM CONTINUING OPERATIONS SUMMARY BY SEGMENT

CHART B
(Dollars in Thousands)

|                      |  |             |         |                 |  |      |         |      |  |      |         |      |  |                  |    |  |  |  |    |  |  |  |    | 
|--------------------- |  | ----------- | ------- | --------------- |  | ---- | ------- | ---- |  | ---- | ------- | ---- |  | ---------------- | -- |  |  |  | -- |  |  |  | -- | 
|                      |  |             |         |                 |  |      |         |      |  |      |         |      |  | Percent of      
|                      |  |             |         |                 |  |      |         |      |  |      |         |      |  | Segment Revenues
|                      |  | Years Ended |         | For Years Ended
|                      |  | April 30,   |         | April 30,      
|                      |  |             |         |                
|                      |  | 2002        |         | 2001            |  | 2000 |         | 2002 |  | 2001 |         | 2000
|                      |  |             |         |                 |  |      |         |      |  |      |         |     
|Construction (1)      |  | $           | 97,150  |                 |  | $    | 131,821 |      |  | $    | 136,396 |      |  |                  | 96 |  |  |  | 93 |  |  |  | 95 | 
|                     
|                     
|                     
|                     
|Real Estate (2)       |  |             | 8,273   |                 |  |      | 7,254   |      |  |      | 19,336  |      |  |                  | 61 |  |  |  | 56 |  |  |  | 64 | 
|                     
|                     
|                     
|                     
|Energy Management (3) |  |             | 1,760   |                 |  |      |        |      |  |      |        |      |  |                  | 59 |  |  |  |   |  |  |  |   | 
|                      |  |             |         |                 |  |      |         |      |  |      |         |      |  |                  |    |  |  |  |    |  |  |  |    | 
|Total                 |  | $           | 107,183 |                 |  | $    | 139,075 |      |  | $    | 155,732 |      |  |                  | 91 |  |  |  | 90 |  |  |  | 89 | 
|                      |  |             |         |                 |  |      |         |      |  |      |         |      |  |                  |    |  |  |  |    |  |  |  |    | 

NOTES:



|(1) |  | The increase in the percentage of COSTS AND EXPENSES: Applicable to
REVENUES from Continuing Operations for 2002 compared
to 2001 is primarily attributable to an oversupply of contractors in our
marketplace and the resulting competitive pressure on margins, which
is a result of a significant decrease in demand due to the reduction in
the number of available construction jobs because of ongoing weakness
in capital spending in the retail industry. The Company also has exposure
to increased costs for many reasons beyond its immediate control,
including, but not limited to, unexpected costs, delays due to weather, or
an individual customers scheduling adjustments. Therefore, the
Company cannot predict whether or how long the percentages reflected above
will continue at the current levels.           
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | The increase in the dollar amount and percentage of COSTS AND EXPENSES:
Applicable to REVENUES from Continuing Operations
for 2002 compared to 2001 is primarily attributable to: (1) the cost of
real estate sold in 2002; (2) management fees paid to an outside asset
manager that only served for a partial year in 2001; and (3) depreciation
expense on the Companys North Ft. Myers shopping center, which
was not depreciated during the fourth quarter 2001 as it was held for
sale. During the fourth quarter 2002, the center was removed from
the market and reclassified to Income-producing property, resulting in
recapture of the depreciation not taken in fiscal 2001. The decrease
in the dollar amount and percentage for 2001 compared to 2000 is primarily
attributable to the cost of real estate sold in 2000.
|   
|   
|   
|   
|(3) |  | The Energy Management Segment was formed in May 2001. See Note 16 to the
Consolidated Financial Statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

SELLING, GENERAL AND ADMINISTRATIVE EXPENSESFor the years 2002, 2001, and 2000, Selling, general and administrative
expenses (See Chart C) were $7,543,170, $9,860,037, and
$9,597,295, respectively. As a percentage of Consolidated REVENUES from
Continuing Operations, these expenses were 6% in each of
the years. In reviewing Chart C, the reader should recognize that the volume
of revenues generally would affect these amounts. The
percentages in Chart C are based on expenses as they relate to segment Revenues
in Chart A, with the exception that Parent expenses and
Total expenses relate to Consolidated Revenues.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES FROM CONTINUING OPERATIONS SUMMARY BY SEGMENT

CHART C
(Dollars in Thousands)

|                      |  |             |       |                 |  |      |       |      |  |      |       |      |  |                  |    |  |  |  |   |  |  |  |   | 
|--------------------- |  | ----------- | ----- | --------------- |  | ---- | ----- | ---- |  | ---- | ----- | ---- |  | ---------------- | -- |  |  |  | - |  |  |  | - | 
|                      |  |             |       |                 |  |      |       |      |  |      |       |      |  | Percent of      
|                      |  |             |       |                 |  |      |       |      |  |      |       |      |  | Segment Revenues
|                      |  | Years Ended |       | For Years Ended
|                      |  | April 30,   |       | April 30,      
|                      |  |             |       |                
|                      |  | 2002        |       | 2001            |  | 2000 |       | 2002 |  | 2001 |       | 2000
|                      |  |             |       |                 |  |      |       |      |  |      |       |     
|Construction (1)      |  | $           | 3,092 |                 |  | $    | 6,054 |      |  | $    | 4,267 |      |  |                  | 3  |  |  |  | 4 |  |  |  | 3 | 
|                     
|                     
|                     
|                     
|Real Estate (2)       |  |             | 500   |                 |  |      | 1,098 |      |  |      | 2,160 |      |  |                  | 4  |  |  |  | 8 |  |  |  | 7 | 
|                     
|                     
|                     
|                     
|Energy Management (3) |  |             | 1,360 |                 |  |      |      |      |  |      |      |      |  |                  | 45 |  |  |  |  |  |  |  |  | 
|                     
|                     
|                     
|                     
|Parent                |  |             | 2,591 |                 |  |      | 2,708 |      |  |      | 3,170 |      |  |                  | 2  |  |  |  | 2 |  |  |  | 2 | 
|                      |  |             |       |                 |  |      |       |      |  |      |       |      |  |                  |    |  |  |  |   |  |  |  |   | 
|Total                 |  | $           | 7,543 |                 |  | $    | 9,860 |      |  | $    | 9,597 |      |  |                  | 6  |  |  |  | 6 |  |  |  | 6 | 
|                      |  |             |       |                 |  |      |       |      |  |      |       |      |  |                  |    |  |  |  |   |  |  |  |   | 

NOTES:



|(1) |  | On a dollar basis comparison, the decrease in expenses in 2002 was
primarily due to: (1) a decrease in incentive compensation costs,
which are based on earnings; (2) a decrease in the number of personnel;
and (3) the expense charge in 2001 for an allowance for doubtful
accounts reserve related to a receivable from Montgomery Ward, which had
filed for bankruptcy protection.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | On a dollar basis comparison, the decrease in expenses in 2002 as compared
to both 2001 and 2000 resulted primarily from a decrease
in personnel costs in connection with the Companys outsourcing of its
asset management activities, which began in January 2001.                                                                                                                   
|   
|   
|   
|   
|(3) |  | The Energy Management Segment was formed in May 2001. See Note 16 to the
Consolidated Financial Statements.                                                                                                                                                                                                                                                                            

12



---



##### Table of Contents



INTEREST COSTS

Most of the Interest costs expensed of $4,396,729, $5,050,510, and
$5,386,257, in 2002, 2001, and 2000, respectively, is related to debt
on real estate. Interest costs decreased in 2002 primarily due to a
decrease in interest rates on the Companys variable rate debt.
Interest costs decreased in 2001 primarily due to the sale by the Real
Estate Segment of the manufacturing facility in Lithia Springs,
Georgia, in fiscal 2000 when the Company discontinued its
manufacturing operations. See Discontinued Operations. There
was no capitalized interest in any of the years presented.

FINANCIAL CONDITION AND CHANGES IN FINANCIAL CONDITION

Property held for sale increased by $12,502,037 in 2002, primarily
due to the reclassification of the book value of the Companys
shopping center in Englewood, Florida, from Real estate held for
future development or sale, as the property was under contract to be
sold at April 30, 2002. The sale of this center was closed in June 2002.
Income-producing properties increased by $17,833,226 in 2002,
primarily due to the reclassification of the book value of the
Companys shopping center located in North Ft. Myers, Florida, from
Real estate held for future development or sale, when the Company
decided to suspend efforts to sell the center until overall market
conditions improve. See ITEM 2. PROPERTIES.

LIQUIDITY AND CAPITAL RESOURCES

Except for certain real estate construction loans and occasional
short-term operating loans, the Company has been able to finance
its working capital needs through funds generated internally. If
adequate funds are not generated through normal operations, the
Company has available bank lines of credit. See Note 9 to the
Consolidated Financial Statements. Working capital was
$10,028,188 at April 30, 2002, compared to $11,442,348 at April
30, 2001. Operating activities provided cash of $2,497,276.
Investing activities used cash of $3,320,993, primarily for the
acquisition of the assets of the new Energy Management Segment.
Financing activities used cash of $2,713,828, primarily for
scheduled debt repayments.

In 1992, the Company secured a construction loan for the
property in North Ft. Myers, Florida, from SunTrust Bank. The
primary term of the construction financing was five years, and
the loan most recently was extended to August 2003, in
accordance with the loan agreement, as amended. The loan carries
a floating interest rate of prime plus .375%. As of April 30, 2002,
the principal amount outstanding was $12,319,969. The
Company is currently seeking to refinance the debt on the
property. Although the Company has regularly received extensions
of the SunTrust loan, there can be no assurance it will be able to
continue to do so; and, there can be no assurance that sufficient
proceeds from any refinancing or sale of the property will be
available to pay off the loan on or before its maturity.

In 1997, the Company obtained a permanent mortgage loan of
$3,500,000 on its shopping center in Jackson, Michigan. The loan
had an original term of 22 years and bears interest at 8.625%.
Certain provisions of the loan, as most recently amended in August
2001, require the establishment of a $500,000 letter of credit, which
is to be used to pay down the loan in August 2002, if certain leasing
requirements are not met. As these requirements had not yet been
met as of April 30, 2002, the Company reclassified $500,000 to
Current maturities of long-term debt from Mortgage notes payable,
less current maturities.

In 1999, in connection with the financing of the purchase of the
Companys shopping center in Jacksonville, Florida, the Company
obtained a permanent mortgage loan in the amount of $9,500,000,
which is secured by the center. The loan bears interest at 7.375% and
is scheduled to be fully amortized over twenty years. The loan matures
in 2019, but the lender may call the loan at any time after September
1, 2002. If the loan were called at any time after that date, the
Company would have up to thirteen months to repay the principal
amount of the loan without penalty. In conjunction with the loan, an
Additional Interest Agreement was executed which entitles the lender
to be paid additional interest equal to fifty percent of the quarterly net
cash flow and fifty percent of the appreciation in the property upon
sale or refinance. The liability related to the lenders fifty percent share
of the appreciation in the property was $2,384,945 at April 30, 2002.

In fiscal 2000, the Companys Board of Directors authorized the
repurchase of up to 200,000 shares of Common Stock during the
twelve-month period beginning February 25, 2000, and ending
February 24, 2001. In 2001 and 2002, the Companys Board
authorized additional repurchases of up to 200,000 shares of
Common Stock in each of the subsequent twelve-month periods,
the latest to end on February 25, 2003. Any such purchases, if made,
could be in the open market at prevailing prices or in privately
negotiated transactions. During fiscal 2002, the Company
repurchased a total of 44,524 shares at a cost of $171,073, of which
1,100 shares at a cost of $4,356 were bought subsequent to February
25, 2002, under the currently authorized plan. The Company
financed the purchases with available cash and expects any future
purchases would be made with available cash. The Company did
not purchase any shares in the period between May 1, 2002, and
June 30, 2002.

In May 2001, the Company acquired substantially all of the
assets of an energy management and engineering services company,
Servidyne Systems, Inc., and some intellectual and other intangible
property assets of its affiliated company, Servidyne, Incorporated.
The Company used available cash to purchase the assets for
approximately $3.1 million, including the costs associated with
completing the transaction.

In January 2002, Kmart Corporation filed for protection under
Chapter 11 of the U.S. Bankruptcy Code. At that time, four of the
Companys seven owned retail properties contained stores leased to
Kmart, two of which were freestanding stores. The Company sold
at a gain its Englewood shopping center, which had a Kmart store,
on June 28, 2002. See Note 19 to the Consolidated Financial
Statements. The remaining three Kmart locations owned by the
Company are currently open and operating. The Companys seven
freestanding leaseback Kmart stores are currently open and
operating. Kmart, pursuant to its rights under Chapter 11,
terminated its subleases to the Companys two former leaseback
properties in Louisville, Kentucky, and West St. Paul, Minnesota,

13



---



##### Table of Contents



and the Company subsequently terminated its leases for both
properties.

In March 2002, Kmart published a list of stores that it would
close. None of the properties leased or subleased to Kmart by the
Company was on the list. The Bankruptcy Court has not provided
the Company any further information as to whether any additional
Kmart stores might be closed or which leases will be rejected or
affirmed. Kmart contacted the Company to request a reduction in
rent for one leaseback location that is currently open. The Company
denied the request, Kmart continues to pay full rent, and the store
remains open.

On June 28, 2002, the Company sold its shopping center
located in Englewood, Florida, at a gain. The Company plans to use
the excess cash remaining, after repaying the debt and selling
expenses, for operating cash requirements, capital improvements to
owned real estate, or to pursue investment in other growth
opportunities.

Excluding the Englewood shopping center rental revenues and
the revenues from the two leaseback centers that were terminated,
Kmart represented approximately $3.9 million of fiscal 2002 rental
revenues.

In July 2002, the Company refinanced the acquisition and
construction loan on the corporate headquarters building in Atlanta,
Georgia, which had a balance of $4,596,683 as of April 30, 2002.
The new permanent loan, in the original principal amount of
$4,900,000, bears interest at 7.75%, is due in ten years, and is
to be amortized on a twenty-five year schedule. Proceeds from the
new loan remaining after repayment of the original loan and
refinancing costs are expected to be used for operating cash needs.

EFFECTS OF INFLATION ON REVENUES AND OPERATING PROFITS

The effects of inflation upon the Companys operating results are
varied. Inflation in recent years has been modest and has had minimal
effect on the Company. The Construction Segment subcontracts
most of its work at fixed prices, which normally will help that segment
protect its profit margin from any erosion due to inflation.

In the Real Estate Segment, many of the anchor leases are long-term (original terms over 20 years), with fixed rents, except for
contingent rent provisions by which the Company may earn
additional rent as a result of increases in tenants sales. In many cases,
however, the contingent rent provisions permit the anchor tenant to
offset against contingent rents any increases in ad valorem taxes over
a specified amount. If inflation were to rise, ad valorem taxes would
probably increase as well, which, in turn, could cause a decrease in
the contingent rents. Furthermore, the Company has certain repair
obligations, and the costs of repairs increase with inflation.

The Energy Management Segment generally has contracts that
renew on an annual basis. At the time of renewal, contract fees may
be adjusted, subject to customer approval. As inflation impacts the
Companys costs, primarily labor, the Company could seek a price
increase for its contracts in order to protect its profit margin.

Inflation causes interest rates to rise, which has a positive effect
on investment income, but could have a negative effect on profit
margins because of the increased costs of contracts and the increase
in interest expense on variable rate loans. Overall, inflation could
tend to limit the Companys markets and, in turn, could reduce
revenues as well as operating profits and earnings.

CRITICAL ACCOUNTING POLICIES

A critical accounting policy is one which is both important to the
portrayal of a Companys financial position and results of operations,
and requires the Company to make estimates and assumptions in
certain circumstances that affect amounts reported in the
accompanying consolidated financial statements and related notes.
In preparing these financial statements, the Company has made its
best estimates and judgments regarding certain amounts included in
the financials statements, giving due consideration to materiality.
The application of these accounting policies involves the exercise of
judgment and use of assumptions regarding future uncertainties,
and as a result, actual results could differ from those estimates.
Management believes that the Companys most critical accounting
policies are discussed and described in Note 2 to the Consolidated
Financial Statements, which include:

Principles of consolidation and basis of presentation

The consolidated financial statements include the accounts of
Abrams Industries, Inc., its wholly owned subsidiaries, and its
80% investment in Abrams-Columbus Limited Partnership.
All significant intercompany balances and transactions have
been eliminated in consolidation.

Revenue recognition

Construction revenues are reported on the percentage-of-completion method, using costs incurred to date in relation to
estimated total costs of the contracts to measure the stage of
completion. The cumulative effects of changes in estimated
total contract costs and revenues are recorded in the period in
which the facts requiring the revisions become known. At the
time it is determined that a contract will result in a loss, the
entire estimated loss is recorded.

The Company leases space in its income-producing
properties to tenants, and recognizes minimum base rentals as
revenue on a straight-line basis over the lease terms. Tenants
may also be required to pay additional rental amounts based on
property operating expenses. In addition, certain tenants are
required to pay incremental rental amounts based on store sales.
These percentage rents are recognized only as earned.

Revenues from the sale of real estate are recognized at the time
of closing. Costs of sales related to real estate are based on the
specific property sold. When a portion or unit of a development
property is sold, a proportionate share of the total cost of the
development is charged to cost of sales.

Generally, revenues from the sale of manufactured goods were
recognized on the date products were shipped to the customer.
Revenues from certain sales, on which delivery was delayed at the
customers explicit request, were recognized when conditions for
revenue recognition were met.

Energy management revenues primarily consist of services
performed and product sales. Revenues are recognized as services are
completed, and product sales are recognized when goods are
shipped.

14



---



##### Table of Contents



Income-producing properties and property and equipment

Income-producing properties are stated at cost, and are
depreciated for financial reporting purposes using the straight-line method over the estimated useful lives of the properties and
related assets.

Property and equipment is recorded at cost, and is depreciated
for financial reporting purposes using the straight-line method over
the estimated useful lives of the assets. Significant additions, which
extend asset lives, are capitalized. Normal maintenance and repair
costs are expensed as incurred.

Interest and other carrying costs related to real estate assets
under construction are capitalized. Costs of development and
construction are also capitalized. Capitalization of interest and
other carrying costs is discontinued when a project is substantially
completed or if active development ceases.

Impairment of long-lived assets and assets to be disposed of

The Company reviews its long-lived assets and certain
intangible assets for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may
not be recoverable. Recoverability of assets to be held and used
is measured by a comparison of the carrying amount of the asset
to future net cash flows expected to be generated by the asset. If
an asset is considered to be impaired, the impairment to be
recognized is measured by the amount by which the carrying
amount of the asset exceeds the assets fair value. Assets to be
disposed of are reported at the lower of their carrying amount or
fair value less cost to sell. Depreciation is suspended during the
marketing period.

Income taxes

Income taxes are accounted for under the asset and liability
method. Deferred tax assets and liabilities are recognized for the
future tax consequences attributable to differences between the
financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences
are expected to be recovered or settled. The effect of a change in
tax rates on deferred tax assets and liabilities is recognized in
income in the period that includes the enactment date.

New accounting pronouncements

During June 2001, the Financial Accounting Standards Board
(FASB) issued SFAS 141, Business Combinations. Under the
provisions of SFAS 141, all business combinations initiated after
June 30, 2001, must be accounted for using the purchase method
of accounting. The adoption of SFAS 141 did not have a material
impact on the Companys financial statements.

Also during June 2001, the FASB issued SFAS 142, Goodwill
and Other Intangible Assets. Under the provisions of SFAS 142,
there will be no amortization of goodwill and other intangible
assets that have indefinite useful lives. Instead, these assets must
be tested for impairment annually and when events or changes
in circumstances indicate that impairment may have occurred.
The Company elected to adopt SFAS 142 as of May 1, 2001,
and therefore goodwill and a trademark with an indefinite useful
life acquired in the transaction described in Note 16 to the
Consolidated Financial Statements have not been amortized.

During August 2001, the FASB issued SFAS 144,
Accounting for the Impairment or Disposal of Long-Lived Assets.
SFAS 144 supercedes FASB 121, Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be Disposed Of.
In addition, SFAS 144 supercedes the accounting and reporting
provisions of APB Opinion No. 30, Reporting the Results of
Operations-Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring
Events and Transactionsfor segments of a business to be disposed
of. SFAS 144 addresses the treatment of assets held for sale or
to be otherwise disposed of, the evaluation of impairment for
long-lived assets, and the reporting of discontinued operations.
The provisions of SFAS 144 are effective for financial
statements issued for fiscal years beginning after December 15,
2001. The adoption of SFAS 144 is not expected to have a
significant impact on the Companys financial position or cash
flows; however, under SFAS 144, beginning May 1, 2002, the
Company will report any gains or losses recognized on any sale
of its income-producing real estate properties in discontinued
operations, and the results of operations of an operating
property classified as held for sale will be reported in
discontinued operations.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION AND RISKS

Certain statements contained or incorporated by reference in this
Annual Report on Form 10-K, including without limitation,
statements containing the words believes, anticipates, expects,
and words of similar import, are forward-looking statements within
the meaning of the federal securities laws. Such forward-looking
statements involve known and unknown risks, uncertainties and
other matters which may cause the actual results, performance or
achievements of the Company to be materially different from any
future results, performance or uncertainties expressed or implied by
such forward-looking statements.

Factors relating to general global, national, regional and local
economic conditions, including international political stability,
national security, employment levels, wage and salary levels,
consumer confidence, availability of credit, taxation policies, interest
rates, and inflation could negatively impact the Companys
customers, suppliers and sources of capital. Any significant negative
impact on these parties could result in material adverse effects on the
Companys results of operations and financial condition.

The Company is at risk for many other matters beyond its
control. They include, but are not limited to: the impact of the
Kmart Corporation bankruptcy on the Companys rental revenues;
co-tenancy provisions in other anchor leases; the Companys ability
to sell or refinance its real estate; the possibility of not achieving
projected backlog revenues or not realizing earnings from such
revenues; continuing competitive pressures on the availability and
pricing of construction projects; changes in laws and regulations,
including changes in accounting standards and generally accepted
accounting principles; the timing and amount of earnings
recognition related to the possible sale of real estate properties held for

15



---



##### Table of Contents



sale; delays in customer orders; the availability, timing and amount of
possible refinancings related to real estate properties; the level and
volatility of interest rates; the potential loss of a significant customer; and
the deterioration in the financial stability of an anchor tenant,
significant subcontractor or other significant customer.

CONSIDERATION OF STRATEGIC ALTERNATIVES

The Company announced in the first quarter of fiscal 2000 that the Board of
Directors had decided to investigate a wide range of possible
strategic and financial alternatives available to maximize shareholder value.
The investigation, which was completed in fiscal 2000, resulted
in the discontinuance of the Companys manufacturing operations. See
Discontinued Operations.

Also as a result of the investigation, the Company decided to outsource
the asset and property management of the Companys
commercial real estate assets to third parties. During fiscal 2001, the asset
management activities were outsourced to a company newly
formed by former executives of the Real Estate Segment. The property management
activities were also outsourced in fiscal 2001, primarily
to independent, third-party managers. The Company plans to continue to own and
invest in real estate.

DISCONTINUED OPERATIONS

During the quarter ended January 31, 2000, the Board of Directors of the
Company decided to discontinue the operations of its
Manufacturing Segment. The financial statements reflect the operating results
of this business as a discontinued operation, and prior year
financial information has been appropriately restated. See Note 3 to the
Consolidated Financial Statements.
In fiscal 2000, the Company
sold the Manufacturing Segments machinery, equipment, furniture, and raw
materials inventory for $2.2 million.

As of April 30, 2000, the Manufacturing Segment had ceased all operations
and disposed of substantially all of its assets. As of April
30, 2001, the $2.76 million deferred gain from discontinued operations
resulting from the eminent domain taking of the Companys former
manufacturing facility in Atlanta, Georgia, was included in Net liabilities of
discontinued operations on the Consolidated Balance Sheet.
The amount of the condemnation award was settled in October 2001, and Earnings
from discontinued operations for 2002 represent the
recognition of the deferred gain related to this transaction.




ITEM 7A  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Companys major market risk exposure arises from changes in interest rates
and its impact on variable rate debt instruments. In
addition, the Company has interest rate risk associated with fixed rate debt.
The Companys objectives in interest rate risk management are
to limit the negative impact of interest rates on earnings and cash flows and
to lower overall borrowing costs. To achieve its objectives, the
Company borrows at fixed rates when it believes it is in its best interests to
do so, and may enter into derivative financial instruments, such
as interest rate swaps and caps, in order to limit its exposure to interest
rate fluctuations. The Company does not enter into derivative or
interest rate transactions for speculative purposes. There were no derivative
contracts in effect at April 30, 2001, or 2002.

The following table summarizes information related to the Companys market
risk sensitive debt instruments as of April 30, 2002:

|                          |  |                             |        |      |  |      |        |      |  |      |      |       |  |       |      |       |  |  |      |  |  |        |       |  |  |  |        |      |  |           |        | 
|------------------------- |  | --------------------------- | ------ | ---- |  | ---- | ------ | ---- |  | ---- | ---- | ----- |  | ----- | ---- | ----- |  |  | ---- |  |  | ------ | ----- |  |  |  | ------ | ---- |  | --------- | ------ | 
|                          |  | Expected Maturity Date      |        |      |  |      |        |      |  |     
|                          |  | Fiscal year ending April 30 |        |      |  |      |        |      |  |     
|                          |  |                             |        |      |  |      |        |      |  |     
|                          |  | (Dollars in Thousands)      |        |      |  |      |        |      |  |     
|                          |  |                             |        |      |  |      |        |      |  |      |      |       |  |       |      |       |  |  |      |  |  |        |       |  |  |  |        |      |  | Estimated
|                          |  |                             |        |      |  |      |        |      |  |      |      |       |  |       |      |       |  |  |      |  |  | There- |       |  |  |  |        | Fair
|                          |  | 2003                        |        | 2004 |  | 2005 |        | 2006 |  | 2007 |      | after |  | Total |      | Value
|                          |  |                             |        |      |  |      |        |      |  |      |      |       |  |       |      |      
|Fixed rate debt (1)       |  | $                           | 13,652 |      |  |      | 7,706  |      |  |      | 821  |       |  |       | 891  |       |  |  | 909  |  |  |        | 9,175 |  |  |  | 33,154 |      |  |           | 33,276 | 
|                         
|Average interest rate     |  |                             | 9.4%   |      |  |      | 7.5%   |      |  |      | 8.1% |       |  |       | 8.1% |       |  |  | 8.1% |  |  |        | 7.9%  |  |  |  |       |      |  |           |       | 
|                         
|                          |  |                             |        |      |  |      |        |      |  |      |      |       |  |       |      |       |  |  |      |  |  |        |       |  |  |  |        |      |  |           |        | 
|                         
|                         
|                         
|                         
|Variable rate debt (2)(3) |  | $                           | 1,254  |      |  |      | 15,663 |      |  |      |     |       |  |       |     |       |  |  |     |  |  |        |      |  |  |  | 16,917 |      |  |           | 16,917 | 
|                         



|(1) |  | Amount for 2003 includes the approximate $12.2 million debt on the shopping
center in Englewood, Florida, which was repaid when
the center was sold in June 2002. Amount for 2004 includes approximately
$6.95 million of debt on the shopping center in Jacksonville,
Florida, which loan matures in 2019, but may be called at any time after
September 2002, for repayment thirteen months after such call
date. See ITEM 7. LIQUIDITY AND CAPITAL RESOURCES.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Interest on variable rate debt is based on the lenders prime rate, prime
rate plus .375%, or LIBOR plus 2%. Includes the approximate
$4.6 million debt refinanced in July 2002 with $4.9 million debt, with a
fixed rate of 7.75%.                                                                                                                                                                                                                               
|   
|   
|   
|   
|(3) |  | See Note 9 to the Consolidated Financial Statements for rates on individual
variable rate debt instruments.                                                                                                                                                                                                                                                                                                                                                       

16



---



##### Table of Contents






ITEM 8  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

|                                                                                                     |  |        
|---------------------------------------------------------------------------------------------------- |  | -------
|Independent Auditors Report and Report of Independent Accountants                                   |  | page 18
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                     |  |        
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|Consolidated Balance Sheets  April 30, 2002, and 2001                                               |  | page 19
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                     |  |        
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|Consolidated Statements of Operations  For the years ended April 30, 2002, 2001, and 2000           |  | page 20
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                     |  |        
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|Consolidated Statements of Shareholders Equity  For the years ended April 30, 2002, 2001, and 2000 |  | page 21
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                     |  |        
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|Consolidated Statements of Cash Flows  For the years ended April 30, 2002, 2001, and 2000           |  | page 22
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                     |  |        
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|Notes to Consolidated Financial Statements  For the years ended April 30, 2002, 2001, and 2000      |  | page 23
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                     |  |        
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|Schedules:                                                                                           |  |        
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|Schedule Number                                                                                      |  |        
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|II    Valuation and Qualifying Accounts                                                              |  | page 35
|                                                                                                    
|                                                                                                    
|                                                                                                    
|                                                                                                    
|III   Real Estate and Accumulated Depreciation                                                       |  | page 36

17



---



##### Table of Contents



INDEPENDENT AUDITORS REPORT

The Board of Directors and Shareholders
Abrams Industries, Inc.:

We have audited the accompanying consolidated balance sheet of Abrams
Industries, Inc. and subsidiaries (the Company) as of April 30,
2002, and the related consolidated statement of operations, shareholders
equity, and cash flows for the year then ended. Our audit also
included the financial statement schedules listed in the Index at Item 8.
These financial statements and financial statement schedules are
the responsibility of the Companys management. Our responsibility is to
express an opinion on these consolidated financial statements
and financial statement schedules based on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of Abrams Industries, Inc.
and subsidiaries as of April 30, 2002, and the results of their operations and
their cash flows for the year then ended, in conformity with
accounting principles generally accepted in the United States of America. Also
in our opinion, such financial statement schedules, when
considered in relation to the basic consolidated financial statements taken as
whole, present fairly, in all material respects the information
set forth herein.

Deloitte & Touche LLP Signature

Atlanta, Georgia
June 12, 2002
(July 17, 2002, as to Notes 8 and 19)



REPORT OF INDEPENDENT ACCOUNTANTS

To The Board of Directors and Shareholders
Abrams Industries, Inc.:

In our opinion, the consolidated balance sheet as of April 30, 2001 and the
related consolidated statements of operations, shareholders
equity and cash flows for each of the two years in the period ended April 30,
2001 present fairly, in all material respects, the financial position,
results of operations and cash flows of Abrams Industries, Inc. and its
subsidiaries at April 30, 2001 and for each of the two years in the
period ended April 30, 2001, in conformity with accounting principles generally
accepted in the United States of America. In addition, in
our opinion, the financial statement schedules as of April 30, 2001, present
fairly, in all material respects, the information set forth therein
when read in conjunction with the related consolidated financial statements as
of April 30, 2001 and each of the two years in the period
ended April 30, 2001. These financial statements are the responsibility of the
Companys management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with auditing
standards generally accepted in the United States of America, which require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made
by management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our
opinion. We have not audited the consolidated financial statements of Abrams
Industries, Inc. for any period subsequent to April 30, 2001.

Pricewaterhouse Coopers LLP Signature

Atlanta, Georgia
May 23, 2001

18



---



##### Table of Contents



CONSOLIDATED BALANCE SHEETS

|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |            |            | 
|-------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | ---------- | ---------- | ---------- | ---------- | ---------- | ---------- | ---------- | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            | April 30, 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            | 2002       |            | 2001      
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |           
|ASSETS                                                   |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|CURRENT ASSETS:                                          |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Cash and cash equivalents                                                                                                                                       |                                                                                                                                                                                 | $                          | 7,911,205  |            |            | $          | 11,448,750 |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Receivables:                                                                                                                                                    |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                                                                                                 | Trade accounts and notes, net of allowance for doubtful
accounts of $113,566 in 2002 and $43,567 in 2001                                                                        |                            |            | 771,703    |            |            |            | 229,510    |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                                                                                                 | Contracts, net of allowance for doubtful accounts of $917,894
in 2002 and 2001, including retained amounts of
$4,630,398 and $5,173,520 in 2002 and 2001, respectively (Note 4) |                            |            | 11,191,925 |            |            |            | 14,319,282 |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Property held for sale (Note 5 and 19)                                                                                                                          |                                                                                                                                                                                 |                            | 12,502,037 |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Costs and earnings in excess of billings (Note 4)                                                                                                               |                                                                                                                                                                                 |                            | 682,162    |            |            |            | 1,483,195  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Deferred income taxes (Note 10)                                                                                                                                 |                                                                                                                                                                                 |                            | 864,036    |            |            |            | 786,460    |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Other                                                                                                                                                           |                                                                                                                                                                                 |                            | 694,033    |            |            |            | 819,203    |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 | Total current assets       |            |            | 34,617,101 |            |            |            | 29,086,400 | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|INCOME-PRODUCING PROPERTIES, net (Notes 6 and 8)         |                                                                                                                                                                 |                                                                                                                                                                                 | 44,545,585                 |            |            |            | 26,712,359 |           
|                                                        
|                                                        
|                                                        
|                                                        
|PROPERTY AND EQUIPMENT, net (Note 7)                     |                                                                                                                                                                 |                                                                                                                                                                                 | 642,710                    |            |            |            | 1,422,405  |           
|                                                        
|                                                        
|                                                        
|                                                        
|OTHER ASSETS:                                            |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Real estate held for future development or sale                                                                                                                 |                                                                                                                                                                                 |                            | 4,211,073  |            |            |            | 36,100,308 |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Intangible assets, net (Note 17)                                                                                                                                |                                                                                                                                                                                 |                            | 2,416,887  |            |            |            | 1,220,147  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Goodwill (Note 17)                                                                                                                                              |                                                                                                                                                                                 |                            | 1,741,831  |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Other                                                                                                                                                           |                                                                                                                                                                                 |                            | 2,765,696  |            |            |            | 3,078,066  |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|                                                         |                                                                                                                                                                 | $                                                                                                                                                                               | 90,940,883                 |            |            | $          | 97,619,685 |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|LIABILITIES AND SHAREHOLDERS EQUITY                     |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|CURRENT LIABILITIES:                                     |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Trade and subcontractors payables, including retained amounts
of $1,776,684 and $1,942,732 in 2002 and 2001, respectively                                       |                                                                                                                                                                                 | $                          | 8,038,963  |            |            | $          | 8,803,760  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Accrued expenses                                                                                                                                                |                                                                                                                                                                                 |                            | 854,681    |            |            |            | 2,332,906  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Billings in excess of costs and earnings (Note 4)                                                                                                               |                                                                                                                                                                                 |                            | 677,987    |            |            |            | 1,506,766  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Net liabilities of discontinued operations (Note 3)                                                                                                             |                                                                                                                                                                                 |                            |           |            |            |            | 1,903,375  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Accrued profit-sharing (Note 11)                                                                                                                                |                                                                                                                                                                                 |                            | 109,838    |            |            |            | 1,387,755  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Current maturities of long-term debt                                                                                                                            |                                                                                                                                                                                 |                            | 14,907,444 |            |            |            | 1,709,490  |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 | Total current liabilities  |            |            | 24,588,913 |            |            |            | 17,644,052 | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|DEFERRED INCOME TAXES (Note 10)                          |                                                                                                                                                                 |                                                                                                                                                                                 | 4,512,986                  |            |            |            | 3,372,824  |           
|                                                        
|                                                        
|                                                        
|                                                        
|OTHER LIABILITIES                                        |                                                                                                                                                                 |                                                                                                                                                                                 | 3,896,616                  |            |            |            | 3,916,647  |           
|                                                        
|                                                        
|                                                        
|                                                        
|MORTGAGE NOTES PAYABLE, less current maturities (Note 8) |                                                                                                                                                                 |                                                                                                                                                                                 | 19,501,385                 |            |            |            | 32,915,932 |           
|                                                        
|                                                        
|                                                        
|                                                        
|OTHER LONG-TERM DEBT, less current maturities (Note 9)   |                                                                                                                                                                 |                                                                                                                                                                                 | 15,662,107                 |            |            |            | 17,264,687 |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 | Total liabilities          |            |            | 68,162,007 |            |            |            | 75,114,142 | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|COMMITMENTS AND CONTINGENCIES (Notes 5,8 and 9)          |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|SHAREHOLDERS EQUITY (Note 13):                          |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Common stock, $1 par value; 5,000,000 shares authorized;
3,054,439 issued and 2,909,079 outstanding in 2002,
3,041,039 issued and 2,943,303 outstanding in 2001 |                                                                                                                                                                                 |                            | 3,054,439  |            |            |            | 3,041,039  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Additional paid-in capital                                                                                                                                      |                                                                                                                                                                                 |                            | 2,135,005  |            |            |            | 2,097,315  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Deferred stock compensation                                                                                                                                     |                                                                                                                                                                                 |                            | (12,744    | )          |            |            | (75,094    | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Retained earnings                                                                                                                                               |                                                                                                                                                                                 |                            | 18,273,853 |            |            |            | 17,930,914 |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Treasury stock, common shares, 145,360 in 2002 and 97,736 in 2001                                                                                               |                                                                                                                                                                                 |                            | (671,677   | )          |            |            | (488,631   | )         
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 | Total shareholders equity |            |            | 22,778,876 |            |            |            | 22,505,543 | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           
|                                                         |                                                                                                                                                                 | $                                                                                                                                                                               | 90,940,883                 |            |            | $          | 97,619,685 |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                 |                            |            |            |            |            |            |           

See accompanying notes to consolidated financial statements.

19



---



##### Table of Contents



CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |           |            |  
|--------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------ | ------------------------------------------------- | ----------- | --------------------- | --------- | ----------- | ----------- | ------- | ------- | ----------- | ----------- | --------- | ---------- | -
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             | Years Ended April 30,
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                      
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             | 2002                  |           | 2001        |             | 2000   
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |        
|REVENUES:                                                                                                             |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |            
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Construction                                                                                                                                                             |                                            | $                                                 | 100,687,872 |                       |           | $           | 141,118,311 |         |         | $           | 143,915,901 |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Rental income                                                                                                                                                            |                                            |                                                   | 13,178,263  |                       |           |             | 12,956,875  |         |         |             | 12,551,729  |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Real estate sales                                                                                                                                                        |                                            |                                                   | 465,000     |                       |           |             |            |         |         |             | 17,665,456  |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Energy management                                                                                                                                                        |                                            |                                                   | 2,994,879   |                       |           |             |            |         |         |             |            |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Interest                                                                                                                                                                 |                                            |                                                   | 181,255     |                       |           |             | 480,771     |         |         |             | 372,524     |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Other                                                                                                                                                                    |                                            |                                                   | 90,418      |                       |           |             | 51,030      |         |         |             | 73,882      |          
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          |                                            | 117,597,687                                       |             |                       |           | 154,606,987 |             |         |         | 174,579,492 |            
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|COSTS AND EXPENSES:                                                                                                   |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |            
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Construction                                                                                                                                                             |                                            |                                                   | 97,149,635  |                       |           |             | 131,821,216 |         |         |             | 136,396,070 |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Rental property operating expenses, excluding interest                                                                                                                   |                                            |                                                   | 7,867,717   |                       |           |             | 7,254,186   |         |         |             | 6,999,011   |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Cost of real estate sold                                                                                                                                                 |                                            |                                                   | 405,647     |                       |           |             |            |         |         |             | 12,336,908  |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Energy management                                                                                                                                                        |                                            |                                                   | 1,760,007   |                       |           |             |            |         |         |             |            |          
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          |                                            | 107,183,006                                       |             |                       |           | 139,075,402 |             |         |         | 155,731,989 |            
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|Selling, general and administrative                                                                                   |                                                                                                                                                                          |                                            | 7,543,170                                         |             |                       |           | 9,860,037   |             |         |         | 9,597,295   |            
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|Interest costs incurred                                                                                               |                                                                                                                                                                          |                                            | 4,396,729                                         |             |                       |           | 5,050,510   |             |         |         | 5,386,257   |            
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          |                                            | 119,122,905                                       |             |                       |           | 153,985,949 |             |         |         | 170,715,541 |            
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          | (LOSS) EARNINGS BEFORE INCOME TAXES        |                                                   |             | (1,525,218            | )         |             |             | 621,038 |         |             |             | 3,863,951 |           
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|INCOME TAX (BENEFIT) EXPENSE (Note 10):                                                                               |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |            
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Current                                                                                                                                                                  |                                            |                                                   | (622,829    | )                     |           |             | 421,610     |         |         |             | 1,166,553   |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Deferred                                                                                                                                                                 |                                            |                                                   | 6,586       |                       |           |             | (176,897    | )       |         |             | 330,208     |          
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          |                                            | (616,243                                          | )           |                       |           | 244,713     |             |         |         | 1,496,761   |            
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          | (LOSS) EARNINGS FROM CONTINUING OPERATIONS |                                                   |             | (908,975              | )         |             |             | 376,325 |         |             |             | 2,367,190 |           
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|DISCONTINUED OPERATIONS (Note 3):                                                                                     |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |            
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Earnings (loss) from discontinued operations, adjusted
for applicable income tax expense (benefit) of $0 in 2002,
$184,000 in 2001, and $(979,455) in 2000               |                                            |                                                   |            |                       |           |             | 299,847     |         |         |             | (1,636,233  | )        
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | Gain (loss) on sale of assets of discontinued operations,
adjusted for applicable income tax expense (benefit) of
$1,056,000 in 2002, $0 in 2001, and $(576,171) in 2000 |                                            |                                                   | 1,720,749   |                       |           |             |            |         |         |             | (976,099    | )        
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          |                                            | EARNINGS (LOSS) FROM DISCONTINUED OPERATIONS      |             |                       | 1,720,749 |             |             |         | 299,847 |             |             |           | (2,612,332 | )
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          |                                            | EARNINGS (LOSS) BEFORE EXTRAORDINARY ITEM         |             |                       | 811,774   |             |             |         | 676,172 |             |             |           | (245,142   | )
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|Extraordinary loss from early extinguishment of debt,
adjusted for applicable income tax benefit of
$129,607 (Note 7) |                                                                                                                                                                          |                                            |                                                  |             |                       |           |            |             |         |         | (211,463    | )          
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          | NET EARNINGS (LOSS)                        |                                                   | $           | 811,774               |           |             | $           | 676,172 |         |             | $           | (456,605  | )         
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|NET EARNINGS (LOSS) PER SHARE(Note 3):                                                                                |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |            
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | From continuing operations  basic and diluted                                                                                                                           |                                            | $                                                 | (.31        | )                     |           | $           | .13         |         |         | $           | .80         |          
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | From discontinued operations  basic and diluted                                                                                                                         |                                            |                                                   | .59         |                       |           |             | .10         |         |         |             | (.89        | )        
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                      | From extraordinary loss from early extinguishment of
debt  basic and diluted                                                                                            |                                            |                                                   |            |                       |           |             |            |         |         |             | (.07        | )        
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          
|                                                                                                                      |                                                                                                                                                                          |                                            | Net earnings (loss) per share  basic and diluted |             | $                     | .28       |             |             | $       | .23     |             |             | $         | (.16       | )
|                                                                                                                      |                                                                                                                                                                          |                                            |                                                   |             |                       |           |             |             |         |         |             |             |          

See accompanying notes to consolidated financial statements.

20



---



##### Table of Contents



CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY

|            |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |            |          |  
|----------- | ---------------------------------------- | ---------------------------------------- |  | ------------ | ------ | ----------------- | - | ------------- | ------ | ------------ | - | --------- | ------ | ----- | - | ------- | -------- | - | - | ---------- | -------- | - | - | -------- | -------- | - | - | ---------- | -------- | -
|            |                                          |                                          |  | Common Stock |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |         
|            |                                          |                                          |  |              |        | AdditionalPaid-in |   | DeferredStock |        | Retained     |   | Treasury  |        |       |   |        
|            |                                          |                                          |  | Shares       |        | Amount            |   | Capital       |        | Compensation |   | Earnings  |        | Stock |   | Total  
|            |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |        
|BALANCES at |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |           
|           
|           
|           
|           
|            | April 30, 1999                           |                                          |  | 3,014,039    |        |                   | $ | 3,014,039     |        |              | $ | 2,019,690 |        |       | $ |        |          |   | $ | 18,651,382 |          |   | $ | (412,551 | )        |   | $ | 23,272,560 |         
|           
|           
|           
|           
|            | Net loss                                 |                                          |  |             |        |                   |   |              |        |              |   |          |        |       |   |        |          |   |   | (456,605   | )        |   |   |         |          |   |   | (456,605   | )       
|           
|           
|           
|           
|            | Cash dividends declared -
$.16 per share |                                          |  |             |        |                   |   |              |        |              |   |          |        |       |   |        |          |   |   | (469,817   | )        |   |   |         |          |   |   | (469,817   | )       
|            |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |           
|BALANCES at |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |           
|           
|           
|           
|           
|            | April 30, 2000                           |                                          |  | 3,014,039    |        |                   |   | 3,014,039     |        |              |   | 2,019,690 |        |       |   |        |          |   |   | 17,724,960 |          |   |   | (412,551 | )        |   |   | 22,346,138 |         
|           
|           
|           
|           
|            |                                          | Net earnings                             |  |              |       |                   |   |               |       |              |   |           |       |       |   |         |         |   |   |            | 676,172  |   |   |          |         |   |   |            | 676,172  |  
|           
|           
|           
|           
|            |                                          | Common stock acquired                    |  |              |       |                   |   |               |       |              |   |           |       |       |   |         |         |   |   |            |         |   |   |          | (76,080  | ) |   |            | (76,080  | )
|           
|           
|           
|           
|            |                                          | Common stock issued                      |  |              | 27,000 |                   |   |               | 27,000 |              |   |           | 77,625 |       |   |         | (104,625 | ) |   |            |         |   |   |          |         |   |   |            |         |  
|           
|           
|           
|           
|            |                                          | Stock compensation expense               |  |              |       |                   |   |               |       |              |   |           |       |       |   |         | 29,531   |   |   |            |         |   |   |          |         |   |   |            | 29,531   |  
|           
|           
|           
|           
|            |                                          | Cash dividends declared -
$.16 per share |  |              |       |                   |   |               |       |              |   |           |       |       |   |         |         |   |   |            | (470,218 | ) |   |          |         |   |   |            | (470,218 | )
|            |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |           
|BALANCES at |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |           
|           
|           
|           
|           
|            | April 30, 2001                           |                                          |  | 3,041,039    |        |                   |   | 3,041,039     |        |              |   | 2,097,315 |        |       |   | (75,094 | )        |   |   | 17,930,914 |          |   |   | (488,631 | )        |   |   | 22,505,543 |         
|           
|           
|           
|           
|            |                                          | Net earnings                             |  |              |       |                   |   |               |       |              |   |           |       |       |   |         |         |   |   |            | 811,774  |   |   |          |         |   |   |            | 811,774  |  
|           
|           
|           
|           
|            |                                          | Common stock acquired                    |  |              |       |                   |   |               |       |              |   |           |       |       |   |         |         |   |   |            |         |   |   |          | (183,046 | ) |   |            | (183,046 | )
|           
|           
|           
|           
|            |                                          | Common stock issued                      |  |              | 13,400 |                   |   |               | 13,400 |              |   |           | 37,690 |       |   |         | (51,090  | ) |   |            |         |   |   |          |         |   |   |            |         |  
|           
|           
|           
|           
|            |                                          | Stock compensation expense               |  |              |       |                   |   |               |       |              |   |           |       |       |   |         | 113,440  |   |   |            |         |   |   |          |         |   |   |            | 113,440  |  
|           
|           
|           
|           
|            |                                          | Cash dividends declared -
$.16 per share |  |              |       |                   |   |               |       |              |   |           |       |       |   |         |         |   |   |            | (468,835 | ) |   |          |         |   |   |            | (468,835 | )
|            |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |           
|BALANCES at |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |           
|           
|           
|           
|           
|            | April 30, 2002                           |                                          |  | 3,054,439    |        |                   | $ | 3,054,439     |        |              | $ | 2,135,005 |        |       | $ | (12,744 | )        |   | $ | 18,273,853 |          |   | $ | (671,677 | )        |   | $ | 22,778,876 |         
|            |                                          |                                          |  |              |        |                   |   |               |        |              |   |           |        |       |   |         |          |   |   |            |          |   |   |          |          |   |   |           

See accompanying notes to consolidated financial statements.

21



---



##### Table of Contents



CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |            |            |            |  
|-------------------------------------------------------- | ------------------------------------------------------------------------------------------ | ---------------------------------------------------------- | ----------------------------------------- | ---------- | --------------------- | ---------- | ---------- | ---------- | ---------- | ---------- | --------- | ---------- | ---------- | ---------- | -
|                                                         |                                                                                            |                                                            |                                           |            | Years Ended April 30,
|                                                         |                                                                                            |                                                            |                                           |            |                      
|                                                         |                                                                                            |                                                            |                                           |            | 2002                  |            | 2001       |            | 2000      
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |           
|Cash flows from operating activities:                    |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Net earnings (loss)                                                                        |                                                            | $                                         | 811,774    |                       |            | $          | 676,172    |            |            | $         | (456,605   | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Adjustments to reconcile net earnings (loss)
to net cash provided by operating activities: |                                                            |                                           |            |                       |            |            |            |            |            |           |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Adjustments related to discontinued operations, net of tax |                                           |            | 113,382               |            |            |            | 3,326,968  |            |           |            | 3,969,324  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Depreciation and amortization                              |                                           |            | 3,164,886             |            |            |            | 2,761,764  |            |           |            | 3,067,959  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Deferred tax (benefit) expense                             |                                           |            | (1,062,587            | )          |            |            | (176,897   | )          |           |            | 286,337    |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Provision for doubtful accounts                            |                                           |            | 69,999                |            |            |            | 936,684    |            |           |            | (22,619    | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Gain on sales of real estate                               |                                           |            | (59,353               | )          |            |            |           |            |           |            | (4,987,478 | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Changes in assets and liabilities:                                                         |                                                            |                                           |            |                       |            |            |            |            |            |           |            |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Receivables, net                                           |                                           |            | 2,431,245             |            |            |            | 4,512,394  |            |           |            | 8,177,387  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Costs and earnings in excess of billings                   |                                           |            | 801,033               |            |            |            | 835,907    |            |           |            | 868,998    |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Other current assets                                       |                                           |            | 108,244               |            |            |            | (246,959   | )          |           |            | (5,844     | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Other assets                                               |                                           |            | 421,256               |            |            |            | (115,120   | )          |           |            | 488,734    |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Trade and subcontractors payable                           |                                           |            | (764,797              | )          |            |            | (4,569,982 | )          |           |            | (3,855,730 | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Accrued expenses                                           |                                           |            | (1,357,839            | )          |            |            | (1,682,467 | )          |           |            | 2,344,414  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Accrued profit-sharing                                     |                                           |            | (1,277,917            | )          |            |            | (51,129    | )          |           |            | (1,150,248 | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Billings in excess of costs and earnings                   |                                           |            | (828,779              | )          |            |            | 217,652    |            |           |            | (1,658,700 | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |                                                                                            | Other liabilities                                          |                                           |            | (73,271               | )          |            |            | (66,620    | )          |           |            | (8,201     | )         
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                         |                                                                                            |                                                            | Net cash provided by operating activities |            |                       | 2,497,276  |            |            |            | 6,358,367  |           |            |            | 7,057,728  |  
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|Cash flows from investing activities:                    |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Proceeds from sales of real estate and property and equipment                              |                                                            |                                           | 407,837    |                       |            |            |           |            |            |           | 6,081,884  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Proceeds from sale of property and equipment of discontinued operations                    |                                                            |                                           |           |                       |            |            |           |            |            |           | 2,070,000  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Additions to income-producing properties, net                                              |                                                            |                                           | (339,207   | )                     |            |            |           |            |            |           | (9,463,803 | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Additions to property, equipment, and other, net                                           |                                                            |                                           | (512,056   | )                     |            |            | (437,412   | )          |            |           | (444,996   | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Acquisition, net of cash acquired                                                          |                                                            |                                           | (2,971,663 | )                     |            |            |           |            |            |           |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Repayments received on notes receivable                                                    |                                                            |                                           | 94,096     |                       |            |            | 127,510    |            |            |           | 117,595    |           
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                         |                                                                                            |                                                            | Net cash used in investing activities     |            |                       | (3,320,993 | )          |            |            | (309,902   | )         |            |            | (1,639,320 | )
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|Cash flows from financing activities:                    |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Short-term borrowings, net                                                                 |                                                            |                                           |           |                       |            |            |           |            |            |           | (7,600,000 | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Debt proceeds                                                                              |                                                            |                                           |           |                       |            |            |           |            |            |           | 9,503,137  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Debt repayments                                                                            |                                                            |                                           | (2,056,947 | )                     |            |            | (1,317,391 | )          |            |           | (6,798,879 | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Deferred loan costs paid                                                                   |                                                            |                                           | (5,000     | )                     |            |            | (5,000     | )          |            |           | (232,426   | )         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Repurchases of common stock                                                                |                                                            |                                           | (183,046   | )                     |            |            | (76,080    | )          |            |           |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Cash dividends                                                                             |                                                            |                                           | (468,835   | )                     |            |            | (470,218   | )          |            |           | (469,817   | )         
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                         |                                                                                            |                                                            | Net cash used in financing activities     |            |                       | (2,713,828 | )          |            |            | (1,868,689 | )         |            |            | (5,597,985 | )
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|Net (decrease) increase in cash and cash equivalents     |                                                                                            |                                                            | (3,537,545                                | )          |                       |            | 4,179,776  |            |            |            | (179,577  | )         
|                                                        
|                                                        
|                                                        
|                                                        
|Cash and cash equivalents at beginning of year           |                                                                                            |                                                            | 11,448,750                                |            |                       |            | 7,268,974  |            |            |            | 7,448,551 |           
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|Cash and cash equivalents at end of year                 |                                                                                            | $                                                          | 7,911,205                                 |            |                       | $          | 11,448,750 |            |            | $          | 7,268,974 |           
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                         |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|Supplemental disclosure of noncash investing activities: |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Transfer of income-producing property to property held for sale                            |                                                            | $                                         |           |                       |            | $          | 31,896,809 |            |            | $         | 33,404     |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Transfer of real estate held for future development or sale to
property held for sale      |                                                            | $                                         | 12,522,944 |                       |            | $          |           |            |            | $         |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Transfer of property to real estate held for future development or sale                    |                                                            | $                                         | 321,710    |                       |            | $          |           |            |            | $         |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Transfer of property held for sale to income-producing property                            |                                                            | $                                         | 19,362,643 |                       |            | $          |           |            |            | $         |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|Supplemental disclosure of noncash financing activities: |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Assumption of debt by purchasers in conjunction with sale of properties                    |                                                            | $                                         |           |                       |            | $          |           |            |            | $         | 10,810,060 |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Issuance of common stock under Stock Award Plan                                            |                                                            | $                                         | 51,090     |                       |            | $          | 104,625    |            |            | $         |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|Supplemental schedule of cash flow information:          |                                                                                            |                                                            |                                           |            |                       |            |            |            |            |            |           |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Cash paid during the year for interest                                                     |                                                            | $                                         | 4,092,065  |                       |            | $          | 4,781,850  |            |            | $         | 5,348,759  |           
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         | Cash paid (refunded) during the year for income taxes, net                                 |                                                            | $                                         | 202,716    |                       |            | $          | 249,811    |            |            | $         | (250,703   | )         

See accompanying notes to consolidated financial statements.

22



---



##### Table of Contents



Notes to Consolidated Financial Statements
APRIL 30, 2002, 2001, AND 2000

1  ORGANIZATION AND BUSINESS

Abrams Industries, Inc. and subsidiaries (the Company) was organized under
Delaware law in 1960. In 1984, the Company changed its state of incorporation
from Delaware to Georgia. The Company engages in (i) construction of retail
and commercial projects, (ii) acquisition, investment, sale, development, and
redevelopment of income-producing properties, and (iii) energy management. The
Companys wholly owned subsidiaries include Abrams Construction, Inc., the
Construction Segment, Abrams Properties, Inc. and subsidiaries, the Real
Estate Segment, and Abrams Power, Inc. and its subsidiary, Servidyne Systems,
LLC, the Energy Management Segment. Abrams Fixture Corporation, another
wholly owned subsidiary, that manufactured store fixtures, bank fixtures and
display units for retail outlets, ceased operations during fiscal year 2000
(Note 3). Previously the Company engaged in asset and property management of
real estate. In fiscal 2001, the Company outsourced all of the asset and
property management of the Companys properties owned or controlled by the Real
Estate Segment to third parties.

2  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)  Principles of consolidation and basis of presentation

The consolidated financial statements include the accounts of Abrams
Industries, Inc., its wholly owned subsidiaries, and its 80% investment in
Abrams-Columbus Limited Partnership. All significant intercompany balances and
transactions have been eliminated in consolidation.

(b)  Use of estimates

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires the
Company to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements, and the reported amounts of revenues and
expenses during the period. Actual results could differ from those estimates.

(c)  Revenue recognition

Construction revenues are reported on the percentage-of-completion method,
using costs incurred to date in relation to estimated total costs of the
contracts to measure the stage of completion. The cumulative effects of changes
in estimated total contract costs and revenues are recorded in the period in
which the facts requiring the revisions become known. At the time it is
determined that a contract will result in a loss, the entire estimated loss is
recorded.

The Company leases space in its income-producing properties to tenants, and
recognizes minimum base rentals as revenue on a straight-line basis over the
lease terms. Tenants may also be required to pay additional rental amounts
based on property operating expenses. In addition, certain tenants are
required to pay incremental rental amounts based on store sales. These
percentage rents are recognized as earned.

Revenues from the sale of real estate are recognized at the time of closing.
Costs of sales related to real estate are based on the specific property sold.
When a portion or unit of a development property is sold, a proportionate share
of the total cost of the development is charged to cost of sales.

Energy management revenues primarily consist of services performed and product
sales. Revenues are recognized as services are completed, and product sales are
recognized when goods are shipped.

Generally, revenues from the sale of manufactured goods were recognized on the
date products were shipped to the customer. Revenues from certain sales, on
which delivery was delayed at the customers explicit request, were recognized
when conditions for revenue recognition were met.

(d)  Cash and cash equivalents

Cash and cash equivalents include money market funds and other financial
instruments. The Company considers all highly liquid financial instruments
with original maturities of three months or less to be cash equivalents.

(e)  Property held for sale

Property held for sale is expected to be sold in the near term and is carried
at the lower of cost or fair value less costs to sell. Depreciation is
suspended during the marketing period.

(f)  Income-producing properties and property and equipment

Income-producing properties are stated at cost, and are depreciated for
financial reporting purposes using the straight-line method over the estimated
useful lives of the properties and related assets.

Property and equipment is recorded at cost and is depreciated for financial
reporting purposes using the straight-line method over the estimated useful
lives of the assets. Significant additions, which extend asset lives, are
capitalized. Normal maintenance and repair costs are expensed as incurred.

Interest and other carrying costs related to assets under construction are
capitalized. Costs of development and construction are also capitalized.
Capitalization of interest and other carrying costs is discontinued when a
project is substantially completed or if active development ceases.

(g)  Real estate held for future development or sale

Real estate held for future development or sale is carried at the lower of cost
or fair value less costs to sell. Depreciation is suspended during the
marketing period.

(h)  Deferred loan costs

Costs incurred to obtain loans have been deferred and are being amortized over
the terms of the related loans.

(i)  Impairment of long-lived assets and assets to be disposed of

The Company reviews its long-lived assets and certain intangible assets for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. Recoverability of assets
to be held and used is measured by a comparison of the carrying amount of the
asset to future net cash flows expected to be generated by the asset. If an
asset is considered to be impaired, the impairment to be

23



---



##### Table of Contents



recognized is measured
by the amount by which the carrying amount of the asset exceeds the assets
fair value. Assets to be disposed of are reported at the lower of their
carrying amount or fair value less cost to sell. Depreciation is suspended
during the marketing period.

(j)  Income taxes

Income taxes are accounted for under the asset and liability method. Deferred
tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases. Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply
to taxable income in the years in which those temporary differences are
expected to be recovered or settled. The effect of a change in tax rates on
deferred tax assets and liabilities is recognized in income in the period that
includes the enactment date.

(k)  Fair value of financial instruments

Management believes that the carrying amounts of cash and cash equivalents,
receivables, other assets, accounts payable, accrued expenses, and the current
portion of debt instruments are reasonable approximations of their fair value,
because of the short-term nature of these instruments.

The fair value of the Companys noncurrent portions of debt instruments is
estimated by discounting the future cash flows of each instrument at rates
currently offered to the Company for similar debt instruments of comparable
maturities by the Companys bankers. Based on this valuation methodology,
management believes that the carrying amount of the noncurrent portions of debt
instruments is a reasonable estimation of their fair value.

(l)  Intangible assets

Intangible assets primarily consist of a trademark, computer software,
computer-based work management products, lease costs, and deferred loan costs.
The trademark is an unamortized intangible as it has an indefinite life,
however, the computer software, computer-based work management products, lease
costs and deferred loan costs are amortized using the straight-line method over
the following estimated useful lives:

|                                        |  |                           
|--------------------------------------- |  | --------------------------
|Computer software                       |  | 3 years                   
|                                       
|                                       
|                                       
|                                       
|Computer-based work management products |  | 3 years                   
|                                       
|                                       
|                                       
|                                       
|Lease costs                             |  | Over the term of the lease
|                                       
|                                       
|                                       
|                                       
|Loan costs                              |  | Over the term of the loan 

(m)  Derivative instruments and hedging activities

The Company accounts for derivative and hedging activities in accordance with
Statement of Financial Accounting Standards (SFAS) 133, Accounting for
Derivative Instruments and Hedging Activities, as amended, which was adopted by
the Company on May 1, 2001. Under SFAS 133, derivative instruments are
recognized in the balance sheet at fair value, and changes in the fair value of
such instruments are recognized currently in earnings unless specific hedge
accounting criteria are met. At April 30, 2002, and 2001, the Company had no
derivative instruments.

(n)  Reclassifications

Certain reclassifications have been made to the 2001 and 2000 consolidated
financial statements to conform to classifications adopted in 2002.

3  DISCONTINUED OPERATIONS

During the quarter ended January 31, 2000, the Board of Directors of the
Company decided to discontinue the operations of Abrams Fixture Corporation,
the Manufacturing Segment. For the years ended April 30, 2001, and 2000, the
Company reported net earnings (loss) from discontinued operations of $299,847
and $(1,636,233), respectively, net of applicable income taxes, related to the
Manufacturing Segment in the Consolidated Statements of Operations. In
addition, for the year ended April 30, 2000, the Company recorded a loss on the
sale of assets of discontinued operations, net of applicable taxes, of
$976,099. The loss on the sale of assets consisted of the disposal of the
Manufacturing Segments machinery, equipment, furniture, raw materials
inventory, and other related assets. At April 30, 2000, the Manufacturing
Segment had ceased all operations and disposed of substantially all of its
assets. The remaining assets and liabilities of the Manufacturing Segment have
been consolidated and presented as Net liabilities of discontinued operations
in the Consolidated Balance Sheet at April 30, 2001.

In June 1999, the Company received notice from the Georgia State Properties
Commission that the Georgia World Congress Center Authority had made the
determination to acquire the Manufacturing Segments former wood manufacturing
facility in Atlanta, Georgia. In October 1999, a Special Master appointed by
the court awarded the Company $4.5 million for the property, which was paid to
the Manufacturing Segment. Both the State and the Company appealed the award
amount. The Company recorded a before-tax deferred gain of $2.76 million,
included in Net liabilities of discontinued operations at April 30, 2001.
During the year ended April 30, 2002, the Company reached a settlement with the
State and recognized an after-tax gain of $1,720,749 on the transaction.

4  CONTRACTS IN PROGRESS

Assets and liabilities related to contracts in progress, including contracts
receivable, are included in current assets and current liabilities as they will
be liquidated in the normal course of contract completion, which is expected to
occur within one year. Amounts billed and costs and earnings recognized on
contracts in progress at April 30 were:

|                                          |                                |   |         |            |      |   |           |            | 
|----------------------------------------- | ------------------------------ | - | ------- | ---------- | ---- | - | --------- | ---------- | 
|                                          |                                |   | 2002    |            | 2001
|                                          |                                |   |         |            |     
|Costs and earnings in
excess of billings: |                                |   |         |            |      |   |           |           
|                                         
|                                         
|                                         
|                                         
|                                          | Accumulated costs and earnings |   | $       | 26,769,091 |      |   | $         | 27,060,898 | 
|                                         
|                                         
|                                         
|                                         
|                                          | Amounts billed                 |   |         | 26,086,929 |      |   |           | 25,577,703 | 
|                                          |                                |   |         |            |      |   |           |            | 
|                                          |                                | $ | 682,162 |            |      | $ | 1,483,195 |           
|                                          |                                |   |         |            |      |   |           |            | 
|Billings in excess of
costs and earnings: |                                |   |         |            |      |   |           |           
|                                         
|                                         
|                                         
|                                         
|                                          | Amounts billed                 |   | $       | 37,142,812 |      |   | $         | 39,966,145 | 
|                                         
|                                         
|                                         
|                                         
|                                          | Accumulated costs and earnings |   |         | 36,464,825 |      |   |           | 38,459,379 | 
|                                          |                                |   |         |            |      |   |           |            | 
|                                          |                                | $ | 677,987 |            |      | $ | 1,506,766 |           
|                                          |                                |   |         |            |      |   |           |            | 

24



---



##### Table of Contents



5  PROPERTY HELD FOR SALE

As of April 30, 2002, the Company had one shopping center held for sale located
in Englewood, Florida. The net carrying amount of this property at April 30,
2002, was $12,502,037. In fiscal 2001, the shopping center was classified as
Real estate held for future development or sale, and was reclassified during
fiscal 2002 as Property held for sale when the shopping center was under
contract. The property was sold at a gain on June 28, 2002 (Note 19). The
results of operations for this property are as follows for the fiscal years
ended April 30:

|                                                                                                         |  |      |           |      |  |      |           |  |  |   |           | 
|-------------------------------------------------------------------------------------------------------- |  | ---- | --------- | ---- |  | ---- | --------- |  |  | - | --------- | 
|                                                                                                         |  | 2002 |           | 2001 |  | 2000
|                                                                                                         |  |      |           |      |  |     
|Revenues                                                                                                 |  | $    | 1,959,747 |      |  | $    | 1,965,276 |  |  | $ | 1,913,799 | 
|                                                                                                        
|                                                                                                        
|                                                                                                        
|                                                                                                        
|Operating expenses, including depreciation (until classified
as held for sale) amortization and interest |  |      | 1,732,740 |      |  |      | 1,876,570 |  |  |   | 1,859,211 | 
|                                                                                                         |  |      |           |      |  |      |           |  |  |   |           | 
|Results of operations                                                                                    |  | $    | 227,007   |      |  | $    | 88,706    |  |  | $ | 54,588    | 
|                                                                                                         |  |      |           |      |  |      |           |  |  |   |           | 

The Company sold its shopping center in Newnan, Georgia, in fiscal 2000, and
recognized a pre-tax gain of approximately $2.9 million on this sale. The sale
was structured as a tax-deferred, like-kind exchange pursuant to Internal
Revenue Code Section 1031, which allows a deferral of the tax gain if the
Company utilizes the proceeds of the sale to purchase other real estate. The
proceeds were used to purchase an approximately 174,000 square foot shopping
center located in Jacksonville, Florida, for $9 million (Note 8).

6  INCOME-PRODUCING PROPERTIES

Income-producing properties and their estimated useful lives at April 30 were
as follows:

|                                                 |  |              |  |      |            |      |            |  |            |   |            | 
|------------------------------------------------ |  | ------------ |  | ---- | ---------- | ---- | ---------- |  | ---------- | - | ---------- | 
|                                                 |  | Estimated    |  |      |            |      |            |  |            |  
|                                                 |  | useful lives |  | 2002 |            | 2001
|                                                 |  |              |  |      |            |     
|Land                                             |  |              |  |      |            | $    | 13,777,053 |  |            | $ | 8,500,421  | 
|                                                
|                                                
|                                                
|                                                
|Buildings and improvements                       |  | 7-39 years   |  |      | 46,060,629 |      |            |  | 27,155,461 |  
|                                                 |  |              |  |      |            |      |            |  |            |   |            | 
|                                                 |  |              |  |      |            | $    | 59,837,682 |  |            | $ | 35,655,882 | 
|                                                
|                                                
|                                                
|                                                
|Less  accumulated depreciation
and amortization |  |              |  |      |            |      | 15,292,097 |  |            |   | 8,943,523  | 
|                                                 |  |              |  |      |            |      |            |  |            |   |            | 
|                                                 |  |              |  |      |            | $    | 44,545,585 |  |            | $ | 26,712,359 | 
|                                                 |  |              |  |      |            |      |            |  |            |   |            | 

Depreciation expense for the years ended April 30, 2002, 2001, and 2000, was
$1,808,125, $1,712,171, and $2,099,113, respectively.

The Companys shopping center located in North Ft. Myers, Florida, was
classified as Real estate held for future development or sale in fiscal 2001,
and was reclassified to Income-producing properties in fiscal 2002 when
management made the decision to suspend efforts to sell the real estate until
overall market conditions improve. Depreciation expense of $833,872 was
recognized in the fourth quarter of fiscal 2002. This amount included
depreciation expense for fiscal 2002 and the fourth quarter of fiscal 2001,
which was suspended during the marketing period, pursuant to FASB 121,
Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of.

7  PROPERTY AND EQUIPMENT

The major components of property and equipment and their estimated useful lives
at April 30 were as follows:

|                                |  |                  |  |      |           |      |           |  |           |   |           | 
|------------------------------- |  | ---------------- |  | ---- | --------- | ---- | --------- |  | --------- | - | --------- | 
|                                |  | Estimated useful |  |      |           |      |           |  |           |  
|                                |  | lives            |  | 2002 |           | 2001
|                                |  |                  |  |      |           |     
|Land                            |  |                  |  |      |           | $    |          |  |           | $ | 92,225    | 
|                               
|                               
|                               
|                               
|Buildings and improvements      |  | 3-39 years       |  |      | 309,460   |      |           |  | 912,430   |  
|                               
|                               
|                               
|                               
|Equipment                       |  | 3-10 years       |  |      | 1,771,733 |      |           |  | 2,586,946 |  
|                                |  |                  |  |      |           |      |           |  |           |   |           | 
|                                |  |                  |  |      |           | $    | 2,081,193 |  |           |   | 3,591,601 | 
|                               
|                               
|                               
|                               
|Less  accumulated depreciation |  |                  |  |      |           |      | 1,438,483 |  |           |   | 2,169,196 | 
|                                |  |                  |  |      |           |      |           |  |           |   |           | 
|                                |  |                  |  |      |           | $    | 642,710   |  |           | $ | 1,422,405 | 
|                                |  |                  |  |      |           |      |           |  |           |   |           | 

In April 2000, the Companys Real Estate Segment sold the manufacturing
facility in Lithia Springs, Georgia, to an unrelated third party. The sales
price was approximately $10.9 million, and the Company recognized a pre-tax
gain on this sale of approximately $2.4 million, which is included in Earnings
from continuing operations. In conjunction with this sale, the Company
reported an extraordinary loss of $211,463, net of income taxes, from the early
extinguishment of debt on the property.

The former metal manufacturing facilitys land and building were reclassified
to Real estate held for future development or sale in fiscal 2002.

Depreciation expense for the years ended April 30, 2002, 2001, and 2000, was
$366,739, $425,235, and $445,414, respectively.

25



---



##### Table of Contents



8  LEASES AND MORTGAGE NOTES PAYABLE

As of April 30, 2002, the Company owned seven shopping
centers, an office park, and an office building. Of the owned
properties, five shopping centers and the office park were pledged
as collateral on related mortgage notes payable. One of the
pledged shopping centers was sold in June 2002, and the office
building was pledged as collateral on a mortgage note in
conjunction with its debt refinancing in July 2002. See Note 19.
Exculpatory provisions on the mortgage notes limit the
Companys liability for repayment to the respective mortgaged
property. The Company also leases seven shopping centers
under leaseback arrangements expiring from 2003 to 2014, as
of April 30, 2002. The Companys leases contain exculpatory
provisions that limit the Companys liability for payment to its
interest in the respective leases.

All of the leaseback centers are subleased to the Kmart Corporation,
and, as of April 30, 2002, Kmart was a tenant in four of the seven
Company-owned shopping centers. The owned shopping centers
are leased to tenants for terms expiring from fiscal 2003 to 2021,
while leases on the owned office properties expire from fiscal years
2003 to 2008. Subleases on the leaseback centers either are the
same as, or may be extended to correspond to, the leaseback
periods. All leases are operating leases. The shopping center leases
typically require that the tenant make fixed rental payments over a
five to twenty-five year period, and may provide for renewal
options and for contingent rentals if the tenants sales volumes
exceed predetermined amounts. In some cases, the shopping center
leases provide that the tenant bear the cost of insurance, repairs,
maintenance, and taxes. Base rental revenue received from owned
shopping centers and office properties in 2002, 2001, and 2000,
was approximately $9,007,000, $8,891,000, and $8,622,000,
respectively. Base rental revenue received from leaseback centers in
2002, 2001, and 2000, was approximately $2,497,000,
$2,620,000, and $2,620,000, respectively. Contingent rental
revenue on all centers in 2002, 2001, and 2000, was
approximately $174,000, $161,000, and $152,000, respectively.

The Company also is due approximately $61,000 in additional
contingent rent in relation to the Kmart in Morton, Illinois,
which is not included in the contingent rental revenue disclosed
above. Kmart is treating this amount as a pre-bankruptcy
petition amount and has therefore not made payment. The
Company is making a claim for payment to the Bankruptcy
Court, and has set up a reserve for the entire amount.

Approximate future minimum annual rental receipts expected
from all rental properties are as follows:

|                      |  |       |            |           |  |   |           | 
|--------------------- |  | ----- | ---------- | --------- |  | - | --------- | 
|Year ending April
30, |  | Owned |            | Leaseback
|                      |  |       |            |          
|2003                  |  | $     | 7,330,000  |           |  | $ | 2,003,000 | 
|                     
|                     
|                     
|                     
|2004                  |  |       | 6,410,000  |           |  |   | 1,688,000 | 
|                     
|                     
|                     
|                     
|2005                  |  |       | 5,736,000  |           |  |   | 1,457,000 | 
|                     
|                     
|                     
|                     
|2006                  |  |       | 5,247,000  |           |  |   | 1,133,000 | 
|                     
|                     
|                     
|                     
|2007                  |  |       | 4,608,000  |           |  |   | 544,000   | 
|                     
|                     
|                     
|                     
|Thereafter            |  |       | 26,367,000 |           |  |   | 2,150,000 | 
|                      |  |       |            |           |  |   |           | 
|                      |  | $     | 55,698,000 |           |  | $ | 8,975,000 | 
|                      |  |       |            |           |  |   |           | 

The expected future minimum principal and interest payments
on mortgage notes payable on the owned rental properties, and
the approximate future minimum rentals expected to be paid on
leaseback centers are as follows:

|                      |  |                         |            |                |  |          |           |  |  |   |           | 
|--------------------- |  | ----------------------- | ---------- | -------------- |  | -------- | --------- |  |  | - | --------- | 
|                      |  | Owned Rental Properties |            |                |  |         
|                      |  | Mortgage Payments       |            | Leaseback     
|                      |  |                         |            | Centers Rental
|Year ending April 30, |  | Principal               |            | Interest       |  | Payments
|                      |  |                         |            |                |  |         
|2003                  |  | $                       | 13,652,899 |                |  | $        | 1,701,299 |  |  | $ | 1,636,000 | 
|                     
|                     
|                     
|                     
|2004                  |  |                         | 7,706,303  |                |  |          | 1,296,511 |  |  |   | 1,425,000 | 
|                     
|                     
|                     
|                     
|2005                  |  |                         | 821,224    |                |  |          | 915,432   |  |  |   | 1,231,000 | 
|                     
|                     
|                     
|                     
|2006                  |  |                         | 890,760    |                |  |          | 845,896   |  |  |   | 861,000   | 
|                     
|                     
|                     
|                     
|2007                  |  |                         | 909,095    |                |  |          | 747,789   |  |  |   | 399,000   | 
|                     
|                     
|                     
|                     
|Thereafter            |  |                         | 9,174,003  |                |  |          | 1,578,506 |  |  |   | 1,834,000 | 
|                      |  |                         |            |                |  |          |           |  |  |   |           | 
|                      |  | $                       | 33,154,284 |                |  | $        | 7,085,433 |  |  | $ | 7,386,000 | 
|                      |  |                         |            |                |  |          |           |  |  |   |           | 

The mortgage notes payable are due at various dates between
August 1, 2002, and September 1, 2019, and bear interest at rates
ranging from 7.25% to 9.50%. At April 30, 2002, the weighted
average rate for all outstanding debt was 7.2%, including Other
long-term debt and credit facilities (See Note 9). See Note 19 for
discussion regarding repayment of the mortgage debt due August 1,
2002, upon the sale of the shopping center on June 28, 2002.

In fiscal 2000, the Company purchased a shopping center in
Jacksonville, Florida, for $9 million, using the proceeds from
the sale of its shopping center in Newnan, Georgia (Note 5).
This purchase was also financed with cash held by the
Company, and by using the Companys lines of credit.
Subsequently, the Company closed on a permanent mortgage
loan secured by the property, and used the proceeds to pay
back the lines of credit. The permanent loan, in the amount
of $9.5 million, bears interest at 7.375% and is scheduled to
be fully amortized over twenty years. Loan proceeds received
in excess of the purchase price were used to pay financing
costs, and are available for use for tenant improvements and
commissions on new leases, if any. The loan may be called at
any time by the lender after September 1, 2002. If the loan
were called at any time after that date, the Company would
have up to 13 months to repay the principal amount of the
loan without penalty.

In conjunction with the Jacksonville, Florida loan, an
Additional Interest Agreement was executed which entitles the
lender to participate in fifty percent of the quarterly net cash
flow and fifty percent of the appreciation in the property upon
sale or refinance, as defined in the Agreement. The
appreciation participation liability, which is included in Other
liabilities, was $2,384,945 and $2,331,705, at April 30, 2002,
and 2001, respectively. The related unamortized loan
discount was $1,651,276 and $1,889,140, at April 30, 2002,
and 2001, respectively.

26



---



##### Table of Contents



9  OTHER LONG-TERM DEBT AND CREDIT FACILITIES

Other long-term debt at April 30 was as follows:

|                                                                                                                                                                                                                                                                                                                            |                            |   |            |            |      |   |            |            | 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | - | ---------- | ---------- | ---- | - | ---------- | ---------- | 
|                                                                                                                                                                                                                                                                                                                            |                            |   | 2002       |            | 2001
|                                                                                                                                                                                                                                                                                                                            |                            |   |            |            |     
|Construction loan bearing interest at the prime rate plus .375%
(5.125% at April 30, 2002); requires monthly principal and interest
payments of $87,729; matures August 31, 2003; secured by real
property and assignment of leases and rents                                                                               |                            | $ | 7,925,172  |            |      | $ | 8,468,277  |           
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|Amendment to construction loan shown above currently permitting
borrowings of up to $4,942,419; bearing interest at the prime rate
plus .375% (5.125% at April 30, 2002); requires monthly principal
and interest payments of $42,113; matures August 31, 2003; secured
by real property and assignment of leases and rents |                            |   | 4,394,797  |            |      |   | 4,620,283  |           
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|Note payable to bank with variable interest rate of LIBOR plus 2%
(3.879% at April 30, 2002); requires monthly principal and interest
payments of $41,047; matures August 31, 2003; secured by real
property and assignment of leases and rents                                                                             |                            |   | 4,596,683  |            |      |   | 4,852,919  |           
|                                                                                                                                                                                                                                                                                                                            |                            |   |            |            |      |   |            |           
|                                                                                                                                                                                                                                                                                                                            | Total other long-term debt |   |            | 16,916,652 |      |   |            | 17,941,479 | 
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                           
|Less current maturities                                                                                                                                                                                                                                                                                                     |                            |   | 1,254,545  |            |      |   | 676,792    |           
|                                                                                                                                                                                                                                                                                                                            |                            |   |            |            |      |   |            |           
|Total other long-term debt, excluding current maturities                                                                                                                                                                                                                                                                    |                            | $ | 15,662,107 |            |      | $ | 17,264,687 |           
|                                                                                                                                                                                                                                                                                                                            |                            |   |            |            |      |   |            |           

The future minimum principal payments due on other long-term debt are as follows:

|                      |  |   |            | 
|--------------------- |  | - | ---------- | 
|Year Ending April
30, |  |   |            | 
|                      |  |   |            | 
|2003                  |  | $ | 1,254,545  | 
|                     
|                     
|                     
|                     
|2004                  |  |   | 15,662,107 | 
|                      |  |   |            | 
|                      |  | $ | 16,916,652 | 
|                      |  |   |            | 

At April 30, 2002, the Company had commitments from a bank
for unsecured lines of credit totaling $12 million of which
$500,000 was restricted as it secures a letter of credit described
below. These lines of credit bear interest at the prime rate or
LIBOR plus 2%, and have a commitment fee of 0.375% on the
unused portion. The lines of credit expire on October 31, 2002.
At April 30, 2002, no amounts were outstanding under these
lines of credit.

In conjunction with the origination of a mortgage on an
income-producing property, the Company obtained an
irrevocable, standby letter of credit in the amount of
$500,000. The letter of credit was originally issued in July
1997, and matures on November 30, 2002. The mortgage
lender is allowed to draw on the letter in order to reduce the
related mortgage loan if certain leasing requirements are not
met. The letter of credit is secured by a bank line of credit,
discussed above.

In fiscal 1998, the Company entered into two interest rate swap
agreements related to industrial development revenue bonds
issued to finance the manufacturing facility in Lithia Springs,
Georgia. The two interest rate swap agreements were
terminated in April 2000 in connection with the sale of the
manufacturing facility. As a result of the termination of the
swap agreements, the Company recorded a gain of $157,000.

27



---



##### Table of Contents



10  INCOME TAXES

The (benefit) provision for income taxes consists of the following:

|                          |  |         |           |          |  |       |          |   |  |   |           |  
|------------------------- |  | ------- | --------- | -------- |  | ----- | -------- | - |  | - | --------- | -
|                          |  | Current |           | Deferred |  | Total
|                          |  |         |           |          |  |      
|Year
ended April 30, 2002 |  |         |           |          |  |       |          |   |  |   |           |  
|                         
|                         
|                         
|                         
|Federal                   |  | $       | (568,695  | )        |  | $     | 6,245    |   |  | $ | (562,450  | )
|                         
|                         
|                         
|                         
|State and local           |  |         | (54,134   | )        |  |       | 341      |   |  |   | (53,793   | )
|                          |  |         |           |          |  |       |          |   |  |   |           |  
|                          |  | $       | (622,829  | )        |  | $     | 6,586    |   |  | $ | (616,243  | )
|                          |  |         |           |          |  |       |          |   |  |   |           |  
|Year ended April 30, 2001 |  |         |           |          |  |       |          |   |  |   |           |  
|                         
|                         
|                         
|                         
|Federal                   |  | $       | 357,807   |          |  | $     | (164,094 | ) |  | $ | 193,713   |  
|                         
|                         
|                         
|                         
|State and local           |  |         | 63,803    |          |  |       | (12,803  | ) |  |   | 51,000    |  
|                          |  |         |           |          |  |       |          |   |  |   |           |  
|                          |  | $       | 421,610   |          |  | $     | (176,897 | ) |  | $ | 244,713   |  
|                          |  |         |           |          |  |       |          |   |  |   |           |  
|Year ended April 30, 2000 |  |         |           |          |  |       |          |   |  |   |           |  
|                         
|                         
|                         
|                         
|Federal                   |  | $       | 818,086   |          |  | $     | 444,653  |   |  | $ | 1,262,739 |  
|                         
|                         
|                         
|                         
|State and local           |  |         | 348,467   |          |  |       | (114,445 | ) |  |   | 234,022   |  
|                          |  |         |           |          |  |       |          |   |  |   |           |  
|                          |  | $       | 1,166,553 |          |  | $     | 330,208  |   |  | $ | 1,496,761 |  
|                          |  |         |           |          |  |       |          |   |  |   |           |  

In fiscal 2002, the Company recognized a deferred gain on discontinued
operations, resulting in a deferred tax liability of
$1,056,000 (Note 3).

Total income tax (benefit) expense recognized in the Consolidated Statements of
Operations differs from the amounts computed by applying the Federal income tax
rate of 34% to pretax (loss) earnings as a result of the following:

|                                                    |                                                                           |   |                     |         |      |   |         |        |   |   |           |         | 
|--------------------------------------------------- | ------------------------------------------------------------------------- | - | ------------------- | ------- | ---- | - | ------- | ------ | - | - | --------- | ------- | 
|                                                    |                                                                           |   | Year ended April 30
|                                                    |                                                                           |   |                    
|                                                    |                                                                           |   | 2002                |         | 2001 |   | 2000   
|                                                    |                                                                           |   |                     |         |      |   |        
|Computed expected tax (benefit) expense           |                                                                           | $ | (518,574            | )       |      | $ | 211,153 |        |   | $ | 1,313,743 |        
|                                                   
|                                                   
|                                                   
|                                                   
|(Decrease) increase in income taxes resulting from: |                                                                           |   |                     |         |      |   |         |        |   |   |           |        
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    | State and local income taxes, net
of federal income tax benefit (expense) |   |                     | (97,669 | )    |   |         | 33,660 |   |   |           | 154,454 | 
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    | Other, net                                                                |   |                     |        |      |   |         | (100   | ) |   |           | 28,564  | 
|                                                    |                                                                           |   |                     |         |      |   |         |        |   |   |           |        
|                                                    |                                                                           | $ | (616,243            | )       |      | $ | 244,713 |        |   | $ | 1,496,761 |        
|                                                    |                                                                           |   |                     |         |      |   |         |        |   |   |           |        

The tax effect of temporary differences that give rise to significant portions of the deferred income tax assets and deferred
income tax liabilities at April 30 are presented below:

|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |           | 
|------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------- | - | --------- | --------- | ---- | - | --------- | --------- | 
|                                                 |                                                                                                                                     |                                     |   | 2002      |           | 2001
|                                                 |                                                                                                                                     |                                     |   |           |           |     
|Deferred income tax assets:                      |                                                                                                                                     |                                     |   |           |           |      |   |          
|                                                
|                                                
|                                                
|                                                
|Items not currently deductible for tax purposes: |                                                                                                                                     |                                     |   |           |           |      |   |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Provisions for impairment on income-producing property                                                                              |                                     | $ | 1,026,816 |           |      | $ | 1,026,816 |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Net operating loss carryforwards, state                                                                                             |                                     |   | 314,992   |           |      |   | 369,370   |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Capitalized costs                                                                                                                   |                                     |   | 477,721   |           |      |   | 498,519   |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Accrued directors fees                                                                                                             |                                     |   | 177,524   |           |      |   | 158,752   |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Bad debt reserve                                                                                                                    |                                     |   | 409,163   |           |      |   | 381,972   |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Deferred compensation plan                                                                                                          |                                     |   | 498,722   |           |      |   | 454,606   |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Compensated absences                                                                                                                |                                     |   | 84,992    |           |      |   | 91,245    |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Other accrued expenses                                                                                                              |                                     |   | 211,475   |           |      |   | 222,762   |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Other                                                                                                                               |                                     |   | 379,458   |           |      |   | 557,562   |          
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          
|                                                 |                                                                                                                                     | Gross deferred income tax assets    |   |           | 3,580,863 |      |   |           | 3,761,604 | 
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          
|Deferred income tax liabilities:                 |                                                                                                                                     |                                     |   |           |           |      |   |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Income-producing properties and property and equipment, principally
because of differences in depreciation and capitalized interest |                                     |   | 1,825,009 |           |      |   | 1,913,647 |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Gain on real estate sales structured as tax-deferred like-kind exchanges                                                            |                                     |   | 5,279,104 |           |      |   | 4,268,288 |          
|                                                
|                                                
|                                                
|                                                
|                                                 | Other                                                                                                                               |                                     |   | 125,700   |           |      |   | 166,033   |          
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          
|                                                 |                                                                                                                                     | Gross deferred income tax liability |   |           | 7,229,813 |      |   |           | 6,347,968 | 
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          
|                                                 |                                                                                                                                     | Net deferred income tax liability   |   | $         | 3,648,950 |      |   | $         | 2,586,364 | 
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          

28



---



##### Table of Contents



There was no valuation allowance against deferred tax assets at
April 30, 2002, and 2001.

For the year ended April 30, 2001, $45,945 of net deferred tax
liability was reclassified to Net liabilities of discontinued
operations (Note 3). The income tax expense of $184,000
related to discontinued operations consisted of current tax
benefit of $50,261, and deferred tax expense of $234,261.

For the year ended April 30, 2000, the income tax benefit of
$1,555,626 related to discontinued operations consisted of current
tax benefit of $1,710,421, and deferred tax expense of $154,795.

11  DEFERRED PROFIT-SHARING PLAN

The Company has a deferred profit-sharing plan (the Plan) which
covers the majority of its employees. Funded employer
contributions to the Plan for 2002, 2001, and 2000, were
approximately $60,000, $634,000, and $678,000, respectively. The
net assets in the Plan, which is administered by an independent
trustee, were approximately $9,290,000, $13,234,000, and
$17,132,000, at April 30, 2002, 2001, and 2000, respectively.

12  SHAREHOLDERS EQUITY

In August 2000, the shareholders approved the 2000 Stock
Award Plan (the Award Plan). The Award Plan permits the grant of
incentive and non-qualified stock options, non-restricted, restricted
and performance stock awards, and stock appreciation rights to
directors, employees, independent contractors, advisors, or
consultants to the Company, as determined by the Compensation
Committee of the Board of Directors. The term and vesting
requirements for each award are determined by the Compensation
Committee, but in no event may the term exceed ten years. Incentive
Stock Options under the Award Plan provide for the purchase of the
Companys common stock at not less than fair market value on the
date the option is issued. The total number of shares available for
grant under the Award Plan is 1,000,000 shares.

On January 19, 2001, the Company granted a restricted stock
award to certain eligible employees, directors, and certain
consultants, which vested on January 19, 2002, as long as the
grantee continued to be employed by the Company until the
vesting date. On May 18, 2001, the Company granted a restricted
stock award to certain eligible employees, which vested on May
18, 2002, as long as the grantee continued to be employed by the
Company until the vesting date. On November 28, 2001, the
Company granted a restricted stock award to an eligible employee
which vests on November 28, 2002, as long as the grantee
continues to be employed by the Company until the vesting date.
During fiscal 2002 and 2001, forfeitures of restricted shares which
did not vest totaled 2,300 and 800 shares, respectively.

The Company recognizes compensation expense ratably over
the vesting period. Stock award compensation expense for the
years ended April 30, 2002, and 2001, was $113,440 and
$29,531, respectively. As of April 30, 2002, after forfeitures
during the year, there were 12,300 shares outstanding under
restricted stock award grants.

As allowed under Statement of Financial Accounting Standards
(SFAS) 123, Accounting for Stock-Based Compensation, the
Company will account for all options issued to employees under the
Award Plan in accordance with Accounting Principles Board Opinion
(APB) 25, Accounting for Stock Issued to Employees, and
compensation expense, if any, will be recognized accordingly. All
options issued to non-employees will be accounted for under SFAS
123, and compensation expense will be recognized accordingly. In
May 2001, the Company issued 150,616 incentive stock options with
an exercise price of $4.00 per share to certain employees, one-half of
which vested in May 2002 and the remaining one-half will vest in
May 2003, as long as the grantee continues to be employed by the
Company until the vesting date. No options were outstanding in
fiscal 2001 or 2000.

For purposes of the pro forma disclosures required by SFAS
123, the Company has computed the value of all stock and
stock option awards granted during fiscal 2002 using the Black-Scholes option pricing model with the following weighted
average assumptions and results as of April 30, 2002:

|                               |  |  |         | 
|------------------------------ |  |  | ------- | 
|Assumptions                   
|                              
|Risk-free interest rate        |  |  | 4.93%   | 
|                              
|                              
|                              
|                              
|Assumed dividend yield         |  |  | 4.16%   | 
|                              
|                              
|                              
|                              
|Assumed lives of option awards |  |  | 5 years | 
|                              
|                              
|                              
|                              
|Assumed volatility             |  |  | .4150   | 

|                                               |  |   |      | 
|---------------------------------------------- |  | - | ---- | 
|Results                                       
|                                              
|Weighted average fair value of
options granted |  | $ | 1.05 | 

The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting
restrictions and are fully transferable. In addition, option valuation
models require the input of highly subjective assumptions. In the
Companys opinion, because the Companys stock-based compensation awards
have characteristics significantly different from
traded options, and because changes in the subjective assumptions can
materially affect the fair value estimate, the results obtained from the
valuation model do not necessarily provide a reliable single measure of
the value of its stock-based compensation awards.

If the Company had accounted for its stock-based compensation
awards in 2002 in accordance with SFAS 123, pro forma results
would have been as follows for the year ended April 30, 2002:

|                                                |                                                  |   |           |      |  
|----------------------------------------------- | ------------------------------------------------ | - | --------- | ---- | -
|Pro forma loss from continuing operations       |                                                  | $ | (955,958  | )   
|                                               
|                                               
|                                               
|                                               
|Pro forma earnings from discontinued operations |                                                  |   | 1,720,749 |     
|                                                |                                                  |   |           |     
|Pro forma net earnings                          |                                                  | $ | 764,791   |     
|                                                |                                                  |   |           |     
|Pro forma net earnings (loss) per share:        |                                                  |   |           |     
|                                               
|                                               
|                                               
|                                               
|                                                | From continuing operations  basic and diluted   |   | $         | (.33 | )
|                                               
|                                               
|                                               
|                                               
|                                                | From discontinued operations  basic and diluted |   |           | .59  |  
|                                                |                                                  |   |           |     
|                                                | Net earnings per share  basic and diluted       |   | $         | .26  |  
|                                                |                                                  |   |           |     

29



---



##### Table of Contents



In fiscal 2000, the Companys Board of Directors authorized the repurchase of
up to 200,000 shares of Common Stock during the
twelve-month period beginning February 25, 2000, and ending February 24, 2001.
In 2001 and 2002, the Companys Board
authorized additional repurchases of up to 200,000 shares of Common Stock in
each of the subsequent twelve-month periods, the
latest to end on February 23, 2003. During fiscal 2002 and 2001, the Company
repurchased 44,524 and 20,053, respectively,
shares of Common Stock. No shares were repurchased in fiscal 2000.

13  NET EARNINGS (LOSS) PER SHARE

Earnings per share is calculated in accordance SFAS 128, Earnings Per Share,
which requires dual presentation of basic and diluted
earnings per share on the face of the income statement for all entities with
complex capital structures. Basic and diluted weighted-average
share differences result solely from dilutive common stock options. Dilutive
potential common shares are calculated in accordance with
the treasury stock method, which assumes that proceeds from the exercise of all
options are used to repurchase common shares at market
value. The number of shares remaining after the exercise proceeds are
exhausted represents the potentially dilutive effect of the options.
Options to purchase 150,616 shares were outstanding at April 30, 2002, but were
not included in the computation of diluted net
earnings (loss) per share for the first three quarters of the fiscal year
because the exercise price of the options was greater than the average
market price of the common shares, and therefore, the effect would be
antidilutive. During the fourth quarter, the average market price
exceeded the exercise price, however, the options did not have a dilutive
effect on earnings per share.

The following tables set forth the computations of basic and diluted net
earnings (loss) per share:

|                                                            |  |                                   |           |               |  |           |           |  |  |   |      |  
|----------------------------------------------------------- |  | --------------------------------- | --------- | ------------- |  | --------- | --------- |  |  | - | ---- | -
|                                                            |  | For
the year ended April 30, 2002
|                                                            |  |                                  
|                                                            |  | Earnings
(loss)                   |           | Shares        |  | Per
share
|                                                            |  | (numerator)                       |           | (denominator) |  | amount   
|                                                            |  |                                   |           |               |  |          
|Basic EPS  earnings per share from continuing operations   |  | $                                 | (908,975  | )             |  |           | 2,909,079 |  |  | $ | (.31 | )
|                                                           
|                                                           
|                                                           
|                                                           
|Basic EPS  earnings per share from discontinued operations |  |                                   | 1,720,749 |               |  |           | 2,909,079 |  |  |   | .59  |  
|                                                           
|                                                           
|                                                           
|                                                           
|Effect of dilutive securities                               |  |                                   |          |               |  |           |          |  |  |   |     |  
|                                                            |  |                                   |           |               |  |           |           |  |  |   |      |  
|Diluted EPS  earnings per share plus assumed conversions   |  | $                                 | 811,774   |               |  |           | 2,909,079 |  |  | $ | .28  |  
|                                                            |  |                                   |           |               |  |           |           |  |  |   |      |  

|                                                            |  |                                   |         |               |  |           |           |  |  |   |     | 
|----------------------------------------------------------- |  | --------------------------------- | ------- | ------------- |  | --------- | --------- |  |  | - | --- | 
|                                                            |  | For the year ended April 30, 2001
|                                                            |  |                                  
|                                                            |  | Earnings                          |         | Shares        |  | Per share
|                                                            |  | (numerator)                       |         | (denominator) |  | amount   
|                                                            |  |                                   |         |               |  |          
|Basic EPS  earnings per share from continuing operations   |  | $                                 | 376,325 |               |  |           | 2,938,504 |  |  | $ | .13 | 
|                                                           
|                                                           
|                                                           
|                                                           
|Basic EPS  earnings per share from discontinued operations |  |                                   | 299,847 |               |  |           | 2,938,504 |  |  |   | .10 | 
|                                                           
|                                                           
|                                                           
|                                                           
|Effect of dilutive securities                               |  |                                   |        |               |  |           |          |  |  |   |    | 
|                                                            |  |                                   |         |               |  |           |           |  |  |   |     | 
|Diluted EPS  earnings per share plus assumed conversions   |  | $                                 | 676,172 |               |  |           | 2,938,504 |  |  | $ | .23 | 
|                                                            |  |                                   |         |               |  |           |           |  |  |   |     | 

|                                                                 |  |                                   |            |               |  |           |           |  |  |   |      |  
|---------------------------------------------------------------- |  | --------------------------------- | ---------- | ------------- |  | --------- | --------- |  |  | - | ---- | -
|                                                                 |  | For the year ended April 30, 2000
|                                                                 |  |                                  
|                                                                 |  | Earnings (loss)                   |            | Shares        |  | Per share
|                                                                 |  | (numerator)                       |            | (denominator) |  | amount   
|                                                                 |  |                                   |            |               |  |          
|Basic EPS  earnings per share from continuing operations        |  | $                                 | 2,367,190  |               |  |           | 2,936,356 |  |  | $ | .80  |  
|                                                                
|                                                                
|                                                                
|                                                                
|Basic EPS  loss per share from discontinued operations          |  |                                   | (2,612,332 | )             |  |           | 2,936,356 |  |  |   | (.89 | )
|                                                                
|                                                                
|                                                                
|                                                                
|Basic EPS  extraordinary loss from early extinguishment of debt |  |                                   | (211,463   | )             |  |           | 2,936,356 |  |  |   | (.07 | )
|                                                                
|                                                                
|                                                                
|                                                                
|Effect of dilutive securities                                    |  |                                   |           |               |  |           |          |  |  |   |     |  
|                                                                 |  |                                   |            |               |  |           |           |  |  |   |      |  
|Diluted EPS  loss per share plus assumed conversions            |  | $                                 | (456,605   | )             |  |           | 2,936,356 |  |  | $ | (.16 | )
|                                                                 |  |                                   |            |               |  |           |           |  |  |   |      |  

30



---



##### Table of Contents



14  OPERATING SEGMENTS

The Company had three operating segments at April 30, 2002:
Construction, Real Estate, and Energy Management. The
Construction Segment activities consist primarily of new construction,
expansion, and remodeling of retail store buildings,
banks, shopping centers, warehouses, and distribution centers. The
Real Estate Segment is involved in the investment in shopping
centers and office properties in the Southeast and Midwest. During
fiscal 2001, the Company entered into contracts with third parties for
the asset and property management functions related to its real estate
portfolio (Note 1). The Energy Management Segment, which began
in fiscal 2002, assists its customers in reducing energy consumption
and operating costs of existing commercial buildings by providing:
(1) engineering services, (2) equipment maintenance and labor
productivity management, and (3) utility cost management.

The operating segments are managed separately and maintain
separate personnel due to the differing services offered by each
segment. Management of each of the segments evaluates and
monitors the performance of the segments based on the operating
earnings or losses prior to income taxes. The significant accounting
policies utilized by the operating segments are the same as those
summarized in Note 2 to the accompanying financial statements of
the Company.

As of April 30, 1999, the Company had another operating
segment, which manufactured store fixtures for retail outlets,
display fixtures for point-of-sale merchandising and other products.
The Manufacturing Segment was discontinued during fiscal year
2000 (Note 3).

Total revenue by operating segment includes both revenues from
unaffiliated customers, as reported in the Companys consolidated
statements of operations, and intersegment revenues, which are
generally at prices negotiated between segments.

The Company had revenues from The Home Depot, Inc., primarily
representing revenues in the Construction Segment, aggregating
approximately 56%, 66%, and 49% of consolidated revenues in
2002, 2001, and 2000, respectively. Revenues from Academy Sports
& Outdoor, generated entirely in the Construction Segment, totaled
18% in 2002, and were less than 10% in 2001 and 2000.

Operating earnings (loss) from continuing operations represents
total revenue less operating expenses, including depreciation and
interest. Selling, general and administrative and interest costs,
deducted in the computation of operating earnings (loss) of each
segment, represent the actual costs incurred by that segment. It
excludes any extraordinary items. Parent expenses and income taxes
have not been allocated to the other subsidiaries.

Segment assets are those that are used in the Companys
operations in each segment, including receivables due from
other segments. The Parent Companys assets are primarily cash
and cash equivalents, cash surrender value of life insurance,
receivables, and assets related to the deferred compensation
plans. Assets attributable to discontinued operations are also
included in the Parent Companys assets in 2001 and 2000.

31



---



##### Table of Contents



14  OPERATING SEGMENTS continued

|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |             | 
|---------------------------------------------------- | ----------------------------------------- | - | ------------ | ----------- | ----------- | - | ---------- | ---------- | ------ | - | ------------ | --------- | ------------ | - | ---------- | ------ |  | - | ---------- | -------- | - | - | ----------- | ----------- | 
|                                                    
|                                                     |                                           |   |              |             |             |   |            |            |        |   | Energy       |           |              |   |            |        |  |   |            |          |   |   |            
|                                                     |                                           |   | Construction |             | Real Estate |   | Management |            | Parent |   | Eliminations |           | Consolidated
|                                                    
|2002                                                 |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |            
|                                                    
|                                                    
|                                                    
|                                                    
|Revenues from unaffiliated
customers                 |                                           | $ | 100,687,872  |             |             | $ | 13,643,263 |            |        | $ | 2,994,879    |           |              | $ |           |        |  | $ |           |          |   | $ | 117,326,014 |            
|                                                    
|                                                    
|                                                    
|                                                    
|Interest and other income                            |                                           |   | 60,537       |             |             |   | 166,186    |            |        |   |             |           |              |   | 55,188     |        |  |   | (10,238    | )        |   |   | 271,673     |            
|                                                    
|                                                    
|                                                    
|                                                    
|Intersegment revenue                                 |                                           |   |             |             |             |   | 461,818    |            |        |   |             |           |              |   |           |        |  |   | (461,818   | )        |   |   |            |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |            
|                                                     | Total revenues from
continuing operations |   | $            | 100,748,409 |             |   | $          | 14,271,267 |        |   | $            | 2,994,879 |              |   | $          | 55,188 |  |   | $          | (472,056 | ) |   | $           | 117,597,687 | 
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |            
|Operating earnings (loss) from
continuing operations |                                           | $ | 243,344      |             |             | $ | 1,093,714  |            |        | $ | (135,945     | )         |              | $ | (2,785,300 | )      |  | $ | 58,969     |          |   | $ | (1,525,218  | )          
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |            
|Segment assets                                       |                                           | $ | 17,868,761   |             |             | $ | 67,392,758 |            |        | $ | 3,441,921    |           |              | $ | 11,742,652 |        |  | $ | (9,505,209 | )        |   | $ | 90,940,883  |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |            
|Interest expense                                     |                                           | $ | 5,255        |             |             | $ | 4,373,118  |            |        | $ | 10,431       |           |              | $ | 7,925      |        |  | $ |           |          |   | $ | 4,396,729   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |            
|Depreciation and amortization                        |                                           | $ | 348,137      |             |             | $ | 2,519,035  |            |        | $ | 201,399      |           |              | $ | 127,041    |        |  | $ | (30,726    | )        |   | $ | 3,164,886   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |            
|Capital expenditures                                 |                                           | $ | 14,655       |             |             | $ | 624,801    |            |        | $ | 39,154       |           |              | $ | 13,769     |        |  | $ |           |          |   | $ | 692,379     |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |           |              |   |            |        |  |   |            |          |   |   |             |            

|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |             | 
|---------------------------------------------------- | ----------------------------------------- | - | ------------ | ----------- | ----------- | - | ---------- | ---------- | ------ | - | ------------ | - | ------------ | - | ---------- | ------ |  | - | ---------- | -------- | - | - | ----------- | ----------- | 
|                                                    
|                                                     |                                           |   |              |             |             |   |            |            |        |   | Energy       |   |              |   |            |        |  |   |            |          |   |   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   | Management   |   |              |   |            |        |  |   |            |          |   |   |            
|                                                     |                                           |   | Construction |             | Real Estate |   | (Note 16)  |            | Parent |   | Eliminations |   | Consolidated
|                                                    
|2001                                                 |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |            
|                                                    
|                                                    
|                                                    
|                                                    
|Revenues from unaffiliated
customers                 |                                           | $ | 141,118,311  |             |             | $ | 12,956,875 |            |        | $ |             |   |              | $ |           |        |  | $ |           |          |   | $ | 154,075,186 |            
|                                                    
|                                                    
|                                                    
|                                                    
|Interest and other income                            |                                           |   | 241,679      |             |             |   | 259,588    |            |        |   |             |   |              |   | 30,534     |        |  |   |           |          |   |   | 531,801     |            
|                                                    
|                                                    
|                                                    
|                                                    
|Intersegment revenue                                 |                                           |   | 28,060       |             |             |   | 388,960    |            |        |   |             |   |              |   |           |        |  |   | (417,020   | )        |   |   |            |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |            
|                                                     | Total revenues from
continuing operations |   | $            | 141,388,050 |             |   | $          | 13,605,423 |        |   | $            |  |              |   | $          | 30,534 |  |   | $          | (417,020 | ) |   | $           | 154,606,987 | 
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |            
|Operating earnings (loss) from
continuing operations |                                           | $ | 3,194,897    |             |             | $ | 200,195    |            |        | $ |             |   |              | $ | (2,819,777 | )      |  | $ | 45,723     |          |   | $ | 621,038     |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |            
|Segment assets                                       |                                           | $ | 23,293,006   |             |             | $ | 69,459,677 |            |        | $ |             |   |              | $ | 11,779,447 |        |  | $ | (6,912,445 | )        |   | $ | 97,619,685  |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |            
|Interest expense                                     |                                           | $ | 12,106       |             |             | $ | 5,019,470  |            |        | $ |             |   |              | $ | 18,934     |        |  | $ |           |          |   | $ | 5,050,510   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |            
|Depreciation and amortization                        |                                           | $ | 420,241      |             |             | $ | 2,315,300  |            |        | $ |             |   |              | $ | 56,004     |        |  | $ | (29,781    | )        |   | $ | 2,761,764   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |            
|Capital expenditures                                 |                                           | $ | 303,541      |             |             | $ | 97,862     |            |        | $ |             |   |              | $ | 4,989      |        |  | $ |           |          |   | $ | 406,392     |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |          |   |   |             |            

|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |             | 
|---------------------------------------------------- | ----------------------------------------- | - | ------------ | ----------- | ----------- | - | ---------- | ---------- | ------ | - | ------------ | - | ------------ | - | ---------- | ------ |  | - | ---------- | ---------- | - | - | ----------- | ----------- | 
|                                                    
|                                                     |                                           |   |              |             |             |   |            |            |        |   | Energy       |   |              |   |            |        |  |   |            |            |   |   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   | Management   |   |              |   |            |        |  |   |            |            |   |   |            
|                                                     |                                           |   | Construction |             | Real Estate |   | (Note 16)  |            | Parent |   | Eliminations |   | Consolidated
|                                                    
|2000                                                 |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |            
|                                                    
|                                                    
|                                                    
|                                                    
|Revenues from unaffiliated
customers                 |                                           | $ | 143,915,901  |             |             | $ | 30,217,185 |            |        | $ |             |   |              | $ |           |        |  | $ |           |            |   | $ | 174,133,086 |            
|                                                    
|                                                    
|                                                    
|                                                    
|Interest and other income                            |                                           |   | 168,005      |             |             |   | 231,261    |            |        |   |             |   |              |   | 67,630     |        |  |   | (20,490    | )          |   |   | 446,406     |            
|                                                    
|                                                    
|                                                    
|                                                    
|Intersegment revenue                                 |                                           |   |             |             |             |   | 1,576,990  |            |        |   |             |   |              |   |           |        |  |   | (1,576,990 | )          |   |   |            |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |            
|                                                     | Total revenues from
continuing operations |   | $            | 144,083,906 |             |   | $          | 32,025,436 |        |   | $            |  |              |   | $          | 67,630 |  |   | $          | (1,597,480 | ) |   | $           | 174,579,492 | 
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |            
|Operating earnings (loss) from
continuing operations |                                           | $ | 3,147,237    |             |             | $ | 4,807,481  |            |        | $ |             |   |              | $ | (3,700,003 | )      |  | $ | (390,764   | )          |   | $ | 3,863,951   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |            
|Segment assets                                       |                                           | $ | 26,551,266   |             |             | $ | 72,311,374 |            |        | $ |             |   |              | $ | 10,716,008 |        |  | $ | (6,732,781 | )          |   | $ | 102,845,867 |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |            
|Interest expense                                     |                                           | $ | 30,747       |             |             | $ | 5,382,720  |            |        | $ |             |   |              | $ | 51,562     |        |  | $ | (78,772    | )          |   | $ | 5,386,257   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |            
|Depreciation and amortization                        |                                           | $ | 368,574      |             |             | $ | 2,508,117  |            |        | $ |             |   |              | $ | 28,459     |        |  | $ | (34,896    | )          |   | $ | 2,870,254   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |            
|Capital expenditures                                 |                                           | $ | 439,505      |             |             | $ | 9,463,803  |            |        | $ |             |   |              | $ | 5,491      |        |  | $ |           |            |   | $ | 9,908,799   |            
|                                                     |                                           |   |              |             |             |   |            |            |        |   |              |   |              |   |            |        |  |   |            |            |   |   |             |            

32



---



##### Table of Contents



15  NEW ACCOUNTING PRONOUNCEMENTS

During June 2001, the Financial Accounting Standards Board (FASB) issued SFAS
141, Business Combinations. Under the provisions of SFAS 141, all business
combinations initiated after June 30, 2001, must be accounted for using the
purchase method of accounting. The adoption of SFAS 141 did not have a material
impact on the Companys financial statements.

Also during June 2001, the FASB issued SFAS 142, Goodwill and Other Intangible
Assets. Under the provisions of SFAS 142, there will be no amortization of
goodwill and other intangible assets that have indefinite useful lives. Instead,
these assets must be tested for impairment annually and when events or changes
in circumstances indicate that impairment may have occurred. The Company elected
to adopt SFAS 142 as of May 1, 2001, and therefore goodwill and a trademark with
an indefinite useful life acquired in the transaction described in Note 16 to
the Consolidated Financial Statements have not been amortized.

During August 2001, the FASB issued SFAS 144, Accounting for the Impairment or
Disposal of Long-Lived Assets. SFAS 144 supercedes FASB 121, Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of. In
addition, SFAS 144 supercedes the accounting and reporting provisions of APB
Opinion No. 30, Reporting the Results of Operations-Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactionsfor segments of a business to be disposed of.
SFAS 144 addresses the treatment of assets held for sale or to be otherwise
disposed of, the evaluation of impairment for long-lived assets, and the
reporting of discontinued operations. The provisions of SFAS 144 are effective
for financial statements issued for fiscal years beginning after December 15,
2001. The adoption of SFAS 144 is not expected to have a significant impact on
the Companys financial position or cash flows; however, under SFAS 144,
beginning May 1, 2002, the Company will report any gains or losses recognized on
sales of its income-producing real estate properties in discontinued operations,
and the results of operations of an operating property classified as held for
sale will be reported in discontinued operations.

16  ACQUISITION

In May 2001, the Company acquired substantially all of the assets and employed
all of the personnel of an energy management and engineering services company,
Servidyne Systems, Inc., and acquired certain intellectual property from an
affiliated company, Servidyne, Incorporated, for approximately $3.1 million,
including the costs associated with completing the acquisition, in an all cash
transaction (the Servidyne transaction). This acquisition was accounted for as
a purchase, and accordingly, the purchase price was allocated to the underlying
assets acquired and liabilities assumed, based upon their estimated fair market
values as of the date of acquisition. The results of operations related to the
acquired assets have been included in the Companys financial statements since
May 2001. Servidyne has offered its expertise, products, and services to its
institutional customers for more than 28 years. In pursuit of growth and
improved shareholder returns, the Company will seek opportunities to leverage
Servidynes reservoir of knowledge in order to assist the now combined customer
base in making building infrastructures more efficient.

A director of the Company, together with her spouse, held directly or as
trustees, approximately 53% of the outstanding common stock of Servidyne
Systems, Inc. and approximately 70% of the outstanding common stock of
Servidyne, Incorporated. This director was also a director and officer of both
Servidyne Systems, Inc. and Servidyne, Incorporated.

The following table summarizes the estimated fair values of the assets acquired
and liabilities assumed at the date of acquisition:

|                                  |                       |   |           |           | 
|--------------------------------- | --------------------- | - | --------- | --------- | 
|Current assets                    |                       | $ | 149,163   |          
|                                 
|                                 
|                                 
|                                 
|Furniture, fixtures and equipment |                       |   | 13,321    |          
|                                 
|                                 
|                                 
|                                 
|Intangible assets                 |                       |   | 1,200,034 |          
|                                 
|                                 
|                                 
|                                 
|Goodwill                          |                       |   | 1,741,831 |          
|                                  |                       |   |           |          
|                                  | Total assets acquired |   |           | 3,104,349 | 
|                                 
|                                 
|                                 
|                                 
|Current liabilities               |                       |   | (132,686  | )        
|                                  |                       |   |           |          
|                                  | Net assets acquired   |   | $         | 2,971,663 | 
|                                  |                       |   |           |          

Of the $1,200,034 of acquired intangible assets, $315,261 was assigned to a
registered trademark that is not subject to amortization. The remainder of the
intangible assets consists of computer-based work management products (five-year
weighted-average useful life) in the amount of $856,113, and other intangible
assets of $28,660 (ten-year useful life). The weighted-average useful life of
all acquired intangible assets subject to amortization is five years.

The goodwill amount has been assigned to the Energy Management Segment. For tax
purposes, all of the goodwill is expected to be amortized and deductible.

The following table displays the consolidated current results for the year ended
April 30, 2002, and the consolidated unaudited proforma results for the year
ended April 30, 2001, as if the acquisition had been completed on May 1, 2000:

|                                               |                                                |   |                     |      |            |   |             |     | 
|---------------------------------------------- | ---------------------------------------------- | - | ------------------- | ---- | ---------- | - | ----------- | --- | 
|                                               |                                                |   | Year ended April 30
|                                               |                                                |   |                    
|                                               |                                                |   | 2002                |      | 2001      
|                                               |                                                |   | (actual)            |      | (proforma)
|                                               |                                                |   |                     |      |           
|Revenues                                       |                                                | $ | 117,597,687         |      |            | $ | 157,412,263 |    
|                                               |                                                |   |                     |      |            |   |             |    
|Net earnings (loss) from
continuing operations |                                                | $ | (908,975            | )    |            | $ | 631,229     |    
|                                              
|                                              
|                                              
|                                              
|Net earnings from
discontinued operations      |                                                |   | 1,720,749           |      |            |   | 299,847     |    
|                                               |                                                |   |                     |      |            |   |             |    
|Net earnings                                   |                                                | $ | 811,774             |      |            | $ | 931,076     |    
|                                               |                                                |   |                     |      |            |   |             |    
|Net earnings (loss) per share:                 |                                                |   |                     |      |            |   |             |    
|                                              
|                                              
|                                              
|                                              
|                                               | From continuing operations-basic and diluted   |   | $                   | (.31 | )          |   | $           | .22 | 
|                                              
|                                              
|                                              
|                                              
|                                               | From discontinued operations-basic and diluted |   |                     | .59  |            |   |             | .10 | 
|                                               |                                                |   |                     |      |            |   |             |    
|                                              
|                                              
|                                              
|                                              
|                                               | Net earnings per share-basic and diluted       |   | $                   | .28  |            |   | $           | .32 | 
|                                               |                                                |   |                     |      |            |   |             |    

33



---



##### Table of Contents



17  GOODWILL AND OTHER INTANGIBLE ASSETS

The following table illustrates the treatment of acquired intangible assets as
of April 30, 2002:

|                            |                                         |        |                |         | 
|--------------------------- | --------------------------------------- | ------ | -------------- | ------- | 
|                            |                                         |        | Gross Carrying
|Amortized intangible assets |                                         | Amount
|                           
|                            | Computer-based work management products |        | $              | 856,113 | 
|                           
|                           
|                           
|                           
|                            | Other                                   |        |                | 28,660  | 
|                            |                                         |        |                |        
|Net assets acquired         |                                         | $      | 884,773        |        
|                            |                                         |        |                |        

|                              |           |   |           |           | 
|----------------------------- | --------- | - | --------- | --------- | 
|Unamortized intangible assets |           |   |           |          
|                             
|                              | Goodwill  |   | $         | 1,741,831 | 
|                             
|                             
|                             
|                             
|                              | Trademark |   |           | 315,261   | 
|                              |           |   |           |          
|Net assets acquired           |           | $ | 2,057,092 |          
|                              |           |   |           |          

The gross carrying amounts and accumulated amortization for all of the Companys
intangible assets as of April 30, 2002, are as follows:

|                                        |  |                |           |              |  |   |           | 
|--------------------------------------- |  | -------------- | --------- | ------------ |  | - | --------- | 
|                                        |  | Gross Carrying |           | Accumulated 
|Amortized intangible assets             |  | Amount         |           | Amortization
|                                       
|Computer-based
work management products |  | $              | 885,951   |              |  | $ | 190,080   | 
|                                       
|                                       
|                                       
|                                       
|Computer software                       |  |                | 304,956   |              |  |   | 243,542   | 
|                                       
|                                       
|                                       
|                                       
|Real estate lease costs                 |  |                | 1,783,381 |              |  |   | 856,573   | 
|                                       
|                                       
|                                       
|                                       
|Deferred loan costs                     |  |                | 819,875   |              |  |   | 428,133   | 
|                                       
|                                       
|                                       
|                                       
|Other                                   |  |                | 28,660    |              |  |   | 2,869     | 
|                                        |  |                |          
|                                        |  | $              | 3,822,823 |              |  | $ | 1,721,197 | 
|                                        |  |                |          

|                              |  |   |           | 
|----------------------------- |  | - | --------- | 
|Unamortized intangible assets |  |   |           | 
|                             
|Goodwill                      |  | $ | 1,741,831 | 
|                             
|                             
|                             
|                             
|Trademark                     |  |   | 315,261   | 
|                              |  |   |           | 
|                              |  | $ | 2,057,092 | 
|                              |  |   |           | 

|                                                                   |  |   |         | 
|------------------------------------------------------------------ |  | - | ------- | 
|Aggregate amortization expense for all amortized intangible assets |  |   |         | 
|                                                                  
|For the year ended April 30, 2002                                  |  | $ | 502,478 | 

|                                                            |  |   |         | 
|----------------------------------------------------------- |  | - | ------- | 
|Estimated amortization expense for all amortized intangible |  |   |         | 
|assets for the fiscal year ended                            |  |   |         | 
|                                                           
|April 30, 2003                                              |  | $ | 453,782 | 
|                                                           
|                                                           
|                                                           
|                                                           
|April 30, 2004                                              |  |   | 350,630 | 
|                                                           
|                                                           
|                                                           
|                                                           
|April 30, 2005                                              |  |   | 332,970 | 
|                                                           
|                                                           
|                                                           
|                                                           
|April 30, 2006                                              |  |   | 226,417 | 
|                                                           
|                                                           
|                                                           
|                                                           
|April 30, 2007                                              |  |   | 119,042 | 

As the acquisition, which resulted in the Companys initial recording of
goodwill, occurred during the current fiscal year, no goodwill or resulting
amortization was recorded in the previous fiscal year. Therefore no proforma
amounts are required to provide comparability.

18  KMART BANKRUPTCY

In January 2002, Kmart Corporation filed for protection under Chapter 11 of the
U.S. Bankruptcy Code. At that time, four of the Companys seven owned retail
properties contained stores leased to Kmart, two of which are freestanding
stores. The Company sold at a gain its Englewood shopping center, which had a
Kmart store, on June 28, 2002. See Note 19 to the Consolidated Financial
Statements. The remaining three Kmart locations owned by the Company are
currently open and operating. Seven freestanding Kmart stores that the Company
developed, sold, leased back, and then subleased to Kmart are currently open and
operating. Kmart, pursuant to its rights under Chapter 11, terminated its
subleases to the Companys two former leaseback properties in Louisville,
Kentucky, and West St. Paul, Minnesota, and the Company subsequently terminated
its leases for both properties.

In March 2002, Kmart published a list of stores that it would close. None of the
properties leased or subleased to Kmart by the Company was on the list. The
Bankruptcy Court has not provided the Company any further information as to
whether any additional Kmart stores might be closed or which leases will be
rejected or affirmed. Kmart contacted the Company to request a reduction in rent
for one leaseback location. The Company denied the request, Kmart continued to
pay full rent, and the store remained open. This location generated
approximately $46,000 in pre-tax earnings in fiscal 2002, and the Company has no
capitalized costs related to this location.

19  SUBSEQUENT EVENT

On June 28, 2002, the Company sold its shopping center located in Englewood,
Florida, at a gain. The property was classified as Property held for sale at
April 30, 2002, in the accompanying Consolidated Balance Sheet. Most of the
proceeds from the sale was used to repay the debt on the property that was
originally due in August 2002, and for other selling costs.

On July 17, 2002, the Company refinanced the acquisition and construction loan
on the corporate headquarters building in Atlanta, Georgia. Proceeds from the
new $4.9 million loan were primarily used to repay the $4.5 million existing
loan and for refinancing costs.

34



---



##### Table of Contents



20  QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Quarterly financial information for the fiscal years ended April 30, 2002, and
2001 (dollars in thousands, except per share amounts):

|                                                |  |                                  |        |                |  |               |        |                |  |   |        |   |  |   |        |  
|----------------------------------------------- |  | -------------------------------- | ------ | -------------- |  | ------------- | ------ | -------------- |  | - | ------ | - |  | - | ------ | -
|                                                |  | Fiscal Year Ended April 30, 2002
|                                               
|                                                |  | First Quarter                    |        | Second Quarter |  | Third Quarter |        | Fourth Quarter
|                                               
|Total revenues                                  |  | $                                | 40,082 |                |  | $             | 33,037 |                |  | $ | 25,208 |   |  | $ | 19,271 |  
|                                               
|                                               
|                                               
|                                               
|Gross profit                                    |  |                                  | 3,142  |                |  |               | 2,755  |                |  |   | 2,358  |   |  |   | 2,160  |  
|                                               
|                                               
|                                               
|                                               
|Net earnings (loss)                             |  |                                  | 52     |                |  |               | 1,575  |                |  |   | (220   | ) |  |   | (595   | )
|                                               
|                                               
|                                               
|                                               
|Net earnings (loss) per share-basic and diluted |  |                                  | .02    |                |  |               | .54    |                |  |   | (.08   | ) |  |   | (.20   | )
|                                               

|                                                |  |                                  |        |                |  |               |        |                |  |   |        |   |  |   |        | 
|----------------------------------------------- |  | -------------------------------- | ------ | -------------- |  | ------------- | ------ | -------------- |  | - | ------ | - |  | - | ------ | 
|                                                |  | Fiscal Year Ended April 30, 2001
|                                               
|                                                |  | First Quarter                    |        | Second Quarter |  | Third Quarter |        | Fourth Quarter
|                                               
|Total revenues                                  |  | $                                | 50,926 |                |  | $             | 53,605 |                |  | $ | 27,521 |   |  | $ | 22,555 | 
|                                               
|                                               
|                                               
|                                               
|Gross profit                                    |  |                                  | 4,209  |                |  |               | 4,904  |                |  |   | 2,852  |   |  |   | 3,567  | 
|                                               
|                                               
|                                               
|                                               
|Net earnings (loss)                             |  |                                  | 560    |                |  |               | 743    |                |  |   | (786   | ) |  |   | 159    | 
|                                               
|                                               
|                                               
|                                               
|Net earnings (loss) per share-basic and diluted |  |                                  | .19    |                |  |               | .25    |                |  |   | (.26   | ) |  |   | .05    | 
|                                               

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

|                                    |                           |  |            |         |            |  |            |         |            |  |             |   |            |  |   |         |     |  |   |           | 
|----------------------------------- | ------------------------- |  | ---------- | ------- | ---------- |  | ---------- | ------- | ---------- |  | ----------- | - | ---------- |  | - | ------- | --- |  | - | --------- | 
|                                    |                           |  |            |         |            |  | Additions  |         |            |  |             |   |            |  |  
|                                    |                           |  |            |         |            |  |            |         |            |  |             |   |            |  |  
|                                    |                           |  | Balance at |         | Charged to |  | Charged to |         |            |  |             |   |            |  |  
|                                    |                           |  | Beginning  |         | Costs and  |  | Other      |         |            |  |             |   | Balance at
|                                    |                           |  | of Year    |         | Expenses   |  | Accounts   |         | Deductions |  | End of Year
|                                   
|Description                         |                           |  |            |         |            |  |            |         |            |  |             |   |            |  |   |         |     |  |   |          
|                                   
|Allowance for doubtful accounts (1) |                           |  |            |         |            |  |            |         |            |  |             |   |            |  |   |         |     |  |   |          
|                                   
|                                    | Year ended April 30, 2002 |  | $          | 961,461 |            |  | $          | 203,687 |            |  | $           |  |            |  | $ | 133,688 | (2) |  | $ | 1,031,460 | 
|                                   
|                                    | Year ended April 30, 2001 |  |            | 210,777 |            |  |            | 983,146 |            |  |             |  |            |  |   | 232,462 | (2) |  |   | 961,461   | 
|                                   
|                                   
|                                   
|                                   
|                                    | Year ended April 30, 2000 |  |            | 122,396 |            |  |            | 120,714 |            |  |             |  |            |  |   | 32,333  | (2) |  |   | 210,777   | 
|                                   
|                                   
|                                   
|                                   
|                                    |                           |  |            |         |            |  |            |         |            |  |             |   |            |  |   |         |     |  |   |          
|                                   
|                                   
|                                   
|                                   
|Inventory reserves (1)              |                           |  |            |         |            |  |            |         |            |  |             |   |            |  |   |         |     |  |   |          
|                                   
|                                    | Year ended April 30, 2002 |  | $          |        |            |  | $          |        |            |  | $           |  |            |  | $ |        |     |  | $ |          | 
|                                   
|                                    | Year ended April 30, 2001 |  |            |        |            |  |            |        |            |  |             |  |            |  |   |        |     |  |   |          | 
|                                   
|                                   
|                                   
|                                   
|                                    | Year ended April 30, 2000 |  |            | 395,425 |            |  |            |        |            |  |             |  |            |  |   | 395,425 | (3) |  |   |          | 



|(1) |  | Includes amounts related to discontinued operations. See Note 3 to the
Consolidated Financial Statements.                                                                                                                                      
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Allowance for doubtful accounts deductions resulted from the subsequent
write-off and/or recovery of the related receivable.                                                                                                                   
|   
|(3) |  | Inventory reserve deductions resulted from the subsequent sale and/or
write-off of the related inventory. All inventory was disposed of as of
April 30, 2000, in conjunction with the discontinuance of the
Manufacturing Segments operations.

35



---



##### Table of Contents



SCHEDULE III Real Estate and Accumulated Depreciation, April 30, 2002

|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           |  
|------------------------------------------------ |  | ------------ | ---------- | ---- |  | ----------------------- | ---------- | -------------- |  | ------------ | ---------- |  |  | ----------- | --------- | -
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  | Costs      
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  | Capitalized
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  | Subsequent 
|                                                 |  |              |            |      |  | Initial Cost to Company |            | to Acquisition
|                                                 |  |              |            |      |  |                         |            |               
|                                                 |  |              |            |      |  |                         |            |                |  | Building and |            |  |  |            
|Description                                      |  | Encumbrances |            | Land |  | Improvements            |            | Improvements  
|                                                 |  |              |            |      |  |                         |            |               
|INCOME-PRODUCING PROPERTIES:                     |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           |  
|                                                
|                                                
|                                                
|                                                
|Shopping Center  Jackson, MI                    |  | $            | 2,904,985  |      |  | $                       | 401,195    |                |  | $            | 1,788,183  |  |  | $           | 1,206,803 |  
|                                                
|                                                
|                                                
|                                                
|Kmart
 Morton, IL                               |  |              | 2,686,603  |      |  |                         | 18,005     |                |  |              | 2,767,764  |  |  |             |          |  
|                                                
|                                                
|                                                
|                                                
|Kmart  Columbus, GA                             |  |              | 1,929,425  |      |  |                         | 11,710     |                |  |              | 2,356,920  |  |  |             | 10,078    |  
|                                                
|                                                
|                                                
|                                                
|Leaseback Shopping Center  Davenport, IA        |  |              |           |      |  |                         |           |                |  |              | 2,150      |  |  |             | 193,261   |  
|                                                
|                                                
|                                                
|                                                
|Leaseback Shopping Center  Jacksonville, FL     |  |              |           |      |  |                         |           |                |  |              | 42,151     |  |  |             |          |  
|                                                
|                                                
|                                                
|                                                
|Leaseback Shopping Center  Orange Park, FL      |  |              |           |      |  |                         |           |                |  |              | 127,487    |  |  |             | 35,731    |  
|                                                
|                                                
|                                                
|                                                
|Leaseback Shopping Center  Minneapolis, MN      |  |              |           |      |  |                         |           |                |  |              |           |  |  |             | 40,778    |  
|                                                
|                                                
|                                                
|                                                
|Office Building  Atlanta, GA                    |  |              | 4,596,683  |      |  |                         | 660,000    |                |  |              | 4,338,102  |  |  |             | 770,063   |  
|                                                
|                                                
|                                                
|                                                
|Office Park  Marietta, GA                       |  |              | 6,213,142  |      |  |                         | 1,750,000  |                |  |              | 6,417,275  |  |  |             | 732,369   |  
|                                                
|                                                
|                                                
|                                                
|Shopping Center  Cincinnati, OH                 |  |              |           |      |  |                         | 1,699,410  |                |  |              | 617,102    |  |  |             | 393,414   |  
|                                                
|                                                
|                                                
|                                                
|Shopping Center  North Ft. Myers, FL            |  |              | 12,319,969 |      |  |                         | 5,940,143  |                |  |              | 11,290,778 |  |  |             | 2,268,173 |  
|                                                
|                                                
|                                                
|                                                
|Shopping Center  Jacksonville, FL               |  |              | 8,864,793  |      |  |                         | 3,908,004  |                |  |              | 5,170,420  |  |  |             | 80,588    |  
|                                                
|                                                 |  |              | 39,515,600 |      |  |                         | 14,388,467 |                |  |              | 34,918,332 |  |  |             | 5,731,258 |  
|                                                
|PROPERTY HELD FOR SALE:                          |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           |  
|                                                
|                                                
|                                                
|                                                
|Shopping Center  Englewood, FL (2)              |  |              | 12,206,700 |      |  |                         | 6,072,805  |                |  |              | 8,823,506  |  |  |             | (76,032   | )
|                                                
|REAL ESTATE HELD FOR FUTURE
DEVELOPMENT OR SALE: |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           |  
|                                                
|                                                
|                                                
|                                                
|Land  Davenport, IA                             |  |              |           |      |  |                         | 183,572    |                |  |              |           |  |  |             |          |  
|                                                
|                                                
|                                                
|                                                
|Land  Louisville, KY                            |  |              |           |      |  |                         | 80,011     |                |  |              |           |  |  |             |          |  
|                                                
|                                                
|                                                
|                                                
|Land  Oakwood, GA                               |  |              |           |      |  |                         | 234,089    |                |  |              |           |  |  |             | 543,330   |  
|                                                
|                                                
|                                                
|                                                
|Land  Jackson, MI                               |  |              |           |      |  |                         |           |                |  |              |           |  |  |             | 74,687    |  
|                                                
|                                                
|                                                
|                                                
|Land  North Ft. Myers, FL                       |  |              |           |      |  |                         | 2,411,703  |                |  |              |           |  |  |             | 345,326   |  
|                                                
|                                                
|                                                
|                                                
|Land and Building  Atlanta, GA (3)              |  |              |           |      |  |                         | 92,226     |                |  |              | 722,033    |  |  |             |          |  
|                                                
|                                                 |  |              |           |      |  |                         | 3,001,601  |                |  |              | 722,033    |  |  |             | 963,343   |  
|                                                
|                                                 |  | $            | 51,722,300 |      |  | $                       | 23,462,873 |                |  | $            | 44,463,871 |  |  | $           | 6,618,569 |  
|                                                

Reconciliations of total real estate carrying value and accumulated depreciation
for the three years ended April 30, are as follows:

|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |           |      |   |            |           |     |   |            |           |  |   |            |           | 
|---------------------------- | ----------------------------------------------------------- | - | ----------- | ------- | ------------------------ | - | ---------- | ------- | ---- | - | ---------- | --------- | ---- | - | ---------- | --------- | --- | - | ---------- | --------- |  | - | ---------- | --------- | 
|                             |                                                             |   | Real Estate |         | Accumulated Depreciation
|                             |                                                             |   |             |         |                         
|                             |                                                             |   | 2002        |         | 2001                     |   | 2000       |         | 2002 |   | 2001       |           | 2000
|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |           |     
|BALANCE AT
BEGINNING OF YEAR |                                                             | $ | 80,081,541  |         |                          | $ | 79,615,241 |         |      | $ | 76,756,798 |           |      | $ | 17,235,470 |           |     | $ | 15,523,299 |           |  | $ | 16,587,209 |          
|                             |                                                             |   |             |        
|ADDITIONS DURING YEAR        |                                                             |   |             |         |                          |   |            |         |      |   |            |           |      |   |            |           |     |   |            |           |  |   |            |          
|                            
|                            
|                            
|                            
|                             | Real Estate                                                 |   |             | 611,585 |                          |   |            | 466,300 |      |   |            | 9,459,144 | (4)  |   |            |          |     |   |            |          |  |   |            |          | 
|                            
|                            
|                            
|                            
|                             | Depreciation                                                |   |             |        |                          |   |            |        |      |   |            |          |      |   |            | 1,808,125 |     |   |            | 1,712,171 |  |   |            | 1,916,654 | 
|                            
|                            
|                            
|                            
|                             | Transfers                                                   |   |             | 814,259 | (3)                      |   |            |        |      |   |            |          |      |   |            | 492,548   | (3) |   |            |          |  |   |            |          | 
|                             |                                                             |   |             |        
|                             |                                                             |   | 1,425,844   |         |                          |   | 466,300    |         |      |   | 9,459,144  |           |      |   | 2,300,673  |           |     |   | 1,712,171  |           |  |   | 1,916,654  |          
|                             |                                                             |   |             |        
|DEDUCTIONS DURING YEAR       |                                                             |   |             |         |                          |   |            |         |      |   |            |           |      |   |            |           |     |   |            |           |  |   |            |          
|                            
|                            
|                            
|                            
|                             | Accumulated depreciation on
properties sold or transferred  |   |             |        |                          |   |            |        |      |   |            |          |      |   |            | 86,983    |     |   |            |          |  |   |            | 2,980,564 | 
|                            
|                            
|                            
|                            
|                             | Carrying value of real estate
sold, transferred, or retired |   |             | 799,530 |                          |   |            |        |      |   |            | 6,600,701 | (5)  |   |            |          |     |   |            |          |  |   |            |          | 
|                             |                                                             |   |             |        
|                             |                                                             |   | 799,530     |         |                          |   |           |         |      |   | 6,600,701  |           |      |   | 86,983     |           |     |   |           |           |  |   | 2,980,564  |          
|                             |                                                             |   |             |        
|BALANCE AT CLOSE OF YEAR     |                                                             | $ | 80,707,855  |         |                          | $ | 80,081,541 |         |      | $ | 79,615,241 |           |      | $ | 19,449,160 |           |     | $ | 17,235,470 |           |  | $ | 15,523,299 |          
|                             |                                                             |   |             |        

36



---



##### Table of Contents



|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              |  |                 |            |              |  |      |            |           |  |  |           |     |  |  |           |  |  |               |   |  | 
|------------------------------------------------ |  | ------------------------ | ---------- | ------------ |  | ------------ | ---------- | ----------- |  | ------------ | --------- | ------------ |  | --------------- | ---------- | ------------ |  | ---- | ---------- | --------- |  |  | --------- | --- |  |  | --------- |  |  | ------------- | - |  | 
|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              |  |                 |            |              |  |      |            |           |  |  |           |     |  |  |           |  |  | Life on Which
|                                                 |  | Gross Amounts at Which   |            |              |  |              |            |             |  |              |           |              |  |                 |            | Depreciation
|                                                 |  | Carried at Close of Year |            |              |  |              |            |             |  |              |           |              |  |                 |            | in Latest   
|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              |  |                 |            | Earnings    
|                                                 |  |                          |            |              |  | Building and |            | Capitalized |  |              |           |              |  | Net Accumulated |            | Date(s) of   |  | Date |            | Statement
|Description                                      |  | Land                     |            | Improvements |  | Interest     |            | Total (1)   |  | Depreciation |           | Construction |  | Acquired        |            | is Computed 
|                                                
|INCOME-PRODUCING PROPERTIES:                    
|Shopping Center  Jackson, MI                    |  | $                        | 453,293    |              |  | $            | 2,942,888  |             |  | $            | 89,866    |              |  | $               | 3,486,047  |              |  | $    | 2,099,244  |           |  |  | 1972,1996 |     |  |  |          |  |  | 39 years     
|                                                
|                                                
|                                                
|                                                
|Kmart
 Morton, IL                               |  |                          | 18,005     |              |  |              | 2,767,764  |             |  |              |          |              |  |                 | 2,785,769  |              |  |      | 2,435,696  |           |  |  | 1980,1992 |     |  |  |          |  |  | 25 years     
|                                                
|                                                
|                                                
|                                                
|Kmart  Columbus, GA                             |  |                          | 11,710     |              |  |              | 2,366,998  |             |  |              | 238,970   |              |  |                 | 2,617,678  |              |  |      | 2,245,762  |           |  |  | 1980,1988 |     |  |  |          |  |  | 25 years     
|                                                
|                                                
|                                                
|                                                
|Leaseback Shopping Center  Davenport, IA        |  |                          |           |              |  |              | 195,411    |             |  |              |          |              |  |                 | 195,411    |              |  |      | 172,985    |           |  |  | 1995      |     |  |  |          |  |  | 7 years      
|                                                
|                                                
|                                                
|                                                
|Leaseback Shopping Center  Jacksonville, FL     |  |                          |           |              |  |              | 42,151     |             |  |              |          |              |  |                 | 42,151     |              |  |      | 16,017     |           |  |  | 1994      |     |  |  |          |  |  | 25 years     
|                                                
|                                                
|                                                
|                                                
|Leaseback Shopping Center  Orange Park, FL      |  |                          |           |              |  |              | 163,218    |             |  |              |          |              |  |                 | 163,218    |              |  |      | 163,218    |           |  |  | 1995      |     |  |  |          |  |  | 7 years      
|                                                
|                                                
|                                                
|                                                
|Leaseback Shopping Center  Minneapolis, MN      |  |                          |           |              |  |              | 40,778     |             |  |              |          |              |  |                 | 40,778     |              |  |      | 9,255      |           |  |  | 1997      |     |  |  |          |  |  | 15 years     
|                                                
|                                                
|                                                
|                                                
|Office Building  Atlanta, GA                    |  |                          | 660,000    |              |  |              | 5,108,165  |             |  |              |          |              |  |                 | 5,768,165  |              |  |      | 890,173    |           |  |  | 1974,1997 | (6) |  |  | 1997      |  |  | 39 years     
|                                                
|                                                
|                                                
|                                                
|Office Park  Marietta, GA                       |  |                          | 1,750,000  |              |  |              | 7,149,644  |             |  |              |          |              |  |                 | 8,899,644  |              |  |      | 1,020,747  |           |  |  | 1980,1985 | (7) |  |  | 1997      |  |  | 39 years     
|                                                
|                                                
|                                                
|                                                
|Shopping Center  Cincinnati, OH                 |  |                          | 1,699,410  |              |  |              | 1,010,516  |             |  |              |          |              |  |                 | 2,709,926  |              |  |      | 100,992    |           |  |  | 1982      | (7) |  |  | 1998      |  |  | 39 years     
|                                                
|                                                
|                                                
|                                                
|Shopping Center  North Ft. Myers, FL            |  |                          | 5,276,631  |              |  |              | 14,222,463 |             |  |              | 4,470,789 |              |  |                 | 23,969,883 |              |  |      | 5,755,508  |           |  |  | 1993,1996 |     |  |  |          |  |  | 31.5 years   
|                                                
|                                                
|                                                
|                                                
|Shopping Center  Jacksonville, FL               |  |                          | 3,908,004  |              |  |              | 5,251,008  |             |  |              |          |              |  |                 | 9,159,012  |              |  |      | 382,500    |           |  |  | 1985      | (7) |  |  | 1999      |  |  | 39 years     
|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              | 
|                                                 |  |                          | 13,777,053 |              |  |              | 41,261,004 |             |  |              | 4,799,625 |              |  |                 | 59,837,682 |              |  |      | 15,292,097 |           |  |  |           |     |  |  |           |  |  |               |   | 
|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              | 
|PROPERTY HELD FOR SALE:                         
|Shopping Center  Englewood, FL (2)              |  |                          | 6,072,805  |              |  |              | 8,747,474  |             |  |              | 1,346,273 |              |  |                 | 16,166,552 |              |  |      | 3,664,515  |           |  |  | 1990      |     |  |  |          |  |  | 32 years     
|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              | 
|REAL ESTATE HELD FOR FUTURE
DEVELOPMENT OR SALE:
|Land  Davenport, IA                             |  |                          | 183,572    |              |  |              |           |             |  |              |          |              |  |                 | 183,572    |              |  |      |           |           |  |  |          |     |  |  | 1977      |  |  |               |  | 
|                                                
|                                                
|                                                
|                                                
|Land  Louisville, KY                            |  |                          | 80,011     |              |  |              |           |             |  |              |          |              |  |                 | 80,011     |              |  |      |           |           |  |  |          |     |  |  | 1979      |  |  |               |  | 
|                                                
|                                                
|                                                
|                                                
|Land  Oakwood, GA                               |  |                          | 777,419    |              |  |              |           |             |  |              | 16,644    |              |  |                 | 794,063    |              |  |      |           |           |  |  |          |     |  |  | 1987      |  |  |               |  | 
|                                                
|                                                
|                                                
|                                                
|Land  Jackson, MI                               |  |                          | 74,687     |              |  |              |           |             |  |              |          |              |  |                 | 74,687     |              |  |      |           |           |  |  | 1996      | (8) |  |  | 1972      |  |  |               |  | 
|                                                
|                                                
|                                                
|                                                
|Land  North Ft. Myers, FL                       |  |                          | 2,757,029  |              |  |              |           |             |  |              |          |              |  |                 | 2,757,029  |              |  |      |           |           |  |  |          |     |  |  | 1993      |  |  |               |   | 
|                                                
|                                                
|                                                
|                                                
|Land and Building  Atlanta, GA (3)              |  |                          | 92,226     |              |  |              | 722,033    |             |  |              |          |              |  |                 | 814,259    |              |  |      | 492,548    |           |  |  | (9        | )   |  |  | 1960,1968 |  |  |               |  | 
|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              | 
|                                                 |  |                          | 3,964,944  |              |  |              | 722,033    |             |  |              | 16,644    |              |  |                 | 4,703,621  |              |  |      | 492,548    |           |  |  |           |     |  |  |           |  |  |               |   | 
|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              | 
|                                                 |  | $                        | 23,814,802 |              |  | $            | 50,730,511 |             |  | $            | 6,162,542 |              |  | $               | 80,707,855 |              |  | $    | 19,449,160 |           |  |  |           |     |  |  |           |  |  |               |   | 
|                                                 |  |                          |            |              |  |              |            |             |  |              |           |              | 



| | NOTES:                                                                                                                              |  | 
| | ----------------------------------------------------------------------------------------------------------------------------------- |  | 
|
| | (1)   The aggregated cost for land and building and improvements for federal income tax purposes at April 30, 2002, is $67,589,838.
| | (2)   Property sold June 28, 2002.                                                                                                 
| | (3)   Vacant former manufacturing facility.                                                                                        
| | (4)   Primarily represents the acquisition of a shopping center in Jacksonville, Florida.                                          
| | (5)   Primarily represents the sale of a shopping center in Newnan, Georgia.                                                       
| | (6)   Constructed by others in 1974, redeveloped by the Company in 1997.                                                           
| | (7)   Constructed by others.                                                                                                       
| | (8)   Outparcel developed by Company in 1996.                                                                                      
| | (9)   Original building constructed by others prior to 1960.                                                                       

ITEM 9 CHANGES IN AND DISAGREEMENTS WITH INDEPENDENT AUDITORS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

See Current Reports on Form 8-K, filed October 30, 2001, and May 28, 2002,
reporting changes in registrants certifying accountants.

37



---



##### Table of Contents






PART III




ITEMS 10-13

The information contained under the headings Nomination and Election of
Directors, Related Party Transactions, Principal Holders of the Companys
Securities, Equity Compensation Plan, and Compensation of Executive Officers
and Directors in the Companys definitive proxy materials for its 2002 Annual
Meeting of Shareholders will be filed with the Securities and Exchange
Commission under a separate filing, and is hereby incorporated by reference.
Information related to Executive Officers of the Company is included in Item 1
of this report.

For purposes of determining the aggregate market value of the Companys
voting stock held by nonaffiliates, shares held directly or indirectly by all
Directors and Executive Officers of the Company have been excluded. The
exclusion of such shares is not intended to, and shall not, constitute a
determination as to which persons or entities may be affiliates of the Company
as defined by the Securities and Exchange Commission.




ITEM 14 EXHIBITS, FINANCIAL
STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.



|(A) |  | The following documents are filed as part of this Annual Report on Form 10-K:
|--- |  | -----------------------------------------------------------------------------

| |  |                                                                                                   
| |  | --------------------------------------------------------------------------------------------------
| |  | 1. Financial Statements:                                                                          
|
|
|
|
| |  | Independent Auditors Report and Report of Independent Accountants                                
|
|
|
|
| |  | Consolidated Balance Sheets at April 30, 2002, and 2001                                           
|
|
|
|
| |  | Consolidated Statement of Operations for the Years Ended April 30, 2002, 2001, and 2000           
|
|
|
|
| |  | Consolidated Statements of Shareholders Equity for the Years Ended April 30, 2002, 2001, and 2000
|
|
|
|
| |  | Consolidated Statements of Cash Flows for the Years Ended April 30, 2002, 2001, and 2000          
|
|
|
|
| |  | Notes to Consolidated Financial Statements                                                        
|
|
|
|
|
| |  | 2. Financial Statement Schedules:                                                                 
|
|
|
|
|
|
|
|
| |  | Schedule II  Valuation and Qualifying Accounts                                                   
|
|
|
|
|
|
|
|
| |  | Schedule III  Real Estate and Accumulated Depreciation                                           
|
|
|
|

|             |  |                                                                                 
|------------ |  | --------------------------------------------------------------------------------
|3. Exhibits:
|            
|            
|            
|            
|Exhibit No. 
|            
|            
|            
|            
|3a.          |  | Articles of Incorporation (1)                                                   
|            
|            
|            
|            
|3b.          |  | Restated Bylaws (2), Amendment to Bylaws (5)                                    
|            
|            
|            
|            
|10a.         |  | Directors Deferred Compensation Plan (3)#                                       
|            
|            
|            
|            
|10b.         |  | Edward M. Abrams Split Dollar Life Insurance Agreements dated July 29, 1991 (4)#
|            
|            
|            
|            
|10c.         |  | Edward M. Abrams Employment Agreement dated November 18, 1998 (6)#              
|            
|            
|            
|            
|10d.         |  | 2000 Stock Award Plan (7) #                                                     
|            
|            
|            
|            
|10e.         |  | E. Milton Bevington Employment Agreement dated May 9, 2001 (8)#                 
|            
|            
|            
|            
|10f.         |  | Alan R. Abrams Split Dollar Life Insurance Agreement dated May 31, 2001 (8)#    
|            
|            
|            
|            
|10g.         |  | J. Andrew Abrams Split Dollar Life Insurance Agreement dated May 31, 2001 (8)#  
|            
|            
|            
|            
|21.          |  | List of the Companys Subsidiaries                                              
|            
|            
|            
|            
|23a.         |  | Consent of Deloitte & Touche LLP                                                
|            
|            
|            
|            
|23b.         |  | Consent of PricewaterhouseCoopers LLP                                           
|            
|            
|            
|            
|99.          |  | Proxy Statement for 2002 Annual Meeting of Shareholders                         

Explanation of Exhibits

|    |  |                                                                                                           
|--- |  | ----------------------------------------------------------------------------------------------------------
|(1) |  | These exhibits are incorporated by reference to the Companys Form 10-K for the year ended April 30, 1985.
|   
|   
|   
|   
|(2) |  | This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April 30, 1997.   
|   
|   
|   
|   
|(3) |  | This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April 30, 1991.   
|   
|   
|   
|   
|(4) |  | These exhibits are incorporated by reference to the Companys Form 10-K for the year ended April 30, 1993.
|   
|   
|   
|   
|(5) |  | This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April 30, 1998.   
|   
|   
|   
|   
|(6) |  | This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April 30, 1999.   
|   
|   
|   
|   
|(7) |  | This exhibit is incorporated by reference to the Companys Form S-8 filed September 29, 2000.             
|   
|   
|   
|   
|(8) |  | This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April 30, 2001.   
|   
|   
|   
|   
|#   |  | Management compensatory plans or arrangement.                                                             



|(B) |  | Reports on Form 8-K: None filed during the fourth quarter of fiscal 2002.                                                                                      
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(C) |  | The Company hereby files as exhibits to this Annual Report on Form 10-K the exhibits set forth in Item 14(A)3 hereof.                                          
|   
|(D) |  | The Company hereby files as financial statement schedules to this Annual Report on Form 10-K the financial statement
schedules set forth in Item 14(A)2 hereof.

38



---



##### Table of Contents



SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

|                     |  |     |  |                        
|-------------------- |  | --- |  | -----------------------
|                     |  |     |  | ABRAMS INDUSTRIES, INC.
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | By: |  | /s/ Alan R. Abrams     
|                    
|                    
|                    
|                    
|                     |  |     |  |                        
|                    
|                    
|                    
|                    
|                     |  |     |  | Alan R. Abrams         
|                    
|                    
|                    
|                    
|                     |  |     |  | Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.

|                     |  |                                       
|-------------------- |  | --------------------------------------
|Dated: July 19, 2002 |  | /s/ Alan R. Abrams                    
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | Alan R. Abrams                        
|                    
|                    
|                    
|                    
|                     |  | Co-Chairman of the Board of Directors,
|                    
|                    
|                    
|                    
|                     |  | Chief Executive Officer               
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ J. Andrew Abrams                  
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | J. Andrew Abrams                      
|                    
|                    
|                    
|                    
|                     |  | Co-Chairman of the Board of Directors 
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ David L. Abrams                   
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | David L. Abrams                       
|                    
|                    
|                    
|                    
|                     |  | Director                              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ Edward M. Abrams                  
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | Edward M. Abrams                      
|                    
|                    
|                    
|                    
|                     |  | Director                              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ Paula Lawton Bevington            
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | Paula Lawton Bevington                
|                    
|                    
|                    
|                    
|                     |  | Director                              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ Gilbert L. Danielson              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | Gilbert L. Danielson                  
|                    
|                    
|                    
|                    
|                     |  | Director                              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ Melinda S. Garrett                
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | Melinda S. Garrett                    
|                    
|                    
|                    
|                    
|                     |  | Director, Chief Financial Officer, and
|                    
|                    
|                    
|                    
|                     |  | Chief Accounting Officer              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ Robert T. McWhinney, Jr.          
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | Robert T. McWhinney, Jr.              
|                    
|                    
|                    
|                    
|                     |  | Director                              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ B. Michael Merritt                
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | B. Michael Merritt                    
|                    
|                    
|                    
|                    
|                     |  | Director                              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ L. Anthony Montag                 
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | L. Anthony Montag                     
|                    
|                    
|                    
|                    
|                     |  | Director                              
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|Dated: July 19, 2002 |  | /s/ Felker W. Ward, Jr.               
|                    
|                    
|                    
|                    
|                     |  |                                       
|                    
|                    
|                    
|                    
|                     |  | Felker W. Ward, Jr.                   
|                    
|                    
|                    
|                    
|                     |  | Director                              

39