##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 10-K

ANNUAL REPORT


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

For the fiscal year ended April 30, 2003

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:

|                     |  |                         
|-------------------- |  | ------------------------
|                     |  | Name of each exchange on
|Title of each class: |  | 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
þ        
NO o

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. þ

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act 12b-2).

YES o
       NO
þ

The aggregate market value of the voting stock held by nonaffiliates of the
registrant as of October 31, 2002, was $5,581,724. See Part III
for a definition of nonaffiliates. The number of shares of Common Stock of the
registrant outstanding as of April 30, 2003, was 2,914,351.

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 2003 Annual Meeting of Shareholders which is to be filed pursuant to Regulation 14A.

n ABRAMS 2003 3





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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, 2003, 2002 AND 2001
|                                                | ITEM 7A   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                                             
|                                                | ITEM 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                                                               
|                                                | ITEM 9 CHANGES IN AND DISAGREEMENTS WITH INDEPENDENT AUDITORS ON ACCOUNTING AND FINANCIAL DISCLOSURE                                             
|PART III                                       
|                                                | ITEMS 10-13                                                                                                                                      
|                                                | ITEM 14 CONTROLS AND PROCEDURES                                                                                                                  
|PART IV                                        
|                                                | ITEM 16 EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K                                                                         
|SIGNATURES                                     
|CERTIFICATION BY CHIEF EXECUTIVE OFFICER       
|CERTIFICATION BY CHIEF FINANCIAL OFFICER       
|EX-10.(H) EDWARD M. ABRAMS RETIREMENT AGREEMENT
|EX-21 LIST OF THE COMPANY'S SUBSIDIARIES       
|EX-23.(A) CONSENT OF DELOITTE & TOUCHE LLP     
|EX-23.(B) CONSENT OF PRICEWATERHOUSECOOPERS LLP
|EX-99.1 SECTION 906 CERTIFICATION OF CEO       
|EX-99.2 SECTION 906 CERTIFICATION OF CFO       



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##### Table of Contents






PART I




ITEM 1 BUSINESS

Abrams Industries, Inc. engages in (i) commercial construction; (ii)
real estate investment and development; 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.

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 13 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. The Company builds, expands, remodels and
renovates retail stores, shopping centers, banks, office buildings, and
distribution and manufacturing facilities, and engages in other types
of commercial construction.

Construction contracts are obtained by competitive bid and by
negotiation. The majority of the Companys construction projects are
fixed-price. Construction revenues are accounted for using 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. 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 primarily involved the acquisition,
development, redevelopment, leasing, management, ownership,
and sale of shopping centers, industrial facilities, and
office
buildings, in the Southeast and Midwest. In fiscal year 2001, the
Company outsourced all of the asset and property management
duties for the Companys properties owned or controlled by the
Real Estate Segment to third parties. In fiscal 2003, the Company
brought back in house the asset management responsibilities and
the property management of one owned shopping center and all of
the leaseback centers.

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 Note 3 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 by and leased back to the
Company, and subleased to Kmart. See ITEM 2. PROPERTIES 
Leaseback Shopping Centers. The Company owns two office
properties. See ITEM 2. PROPERTIES  Office Buildings. The
Company also owns, through its subsidiary, AFC Real Estate, Inc., its
vacant former manufacturing facility located in Atlanta, Georgia.

ENERGY MANAGEMENT SEGMENT

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

The Company provides energy management services that assist
its customers in reducing the costs of operating buildings by
lowering energy consumption and increasing work efficiency. The
Companys engineering services include energy audits, utility
monitoring and analysis, mechanical, electrical and plumbing
surveys, indoor air quality studies, due diligence, and HVAC retrofit
design. The Company also assists building owners and managers in
managing equipment maintenance for the highest efficiency and
useful equipment life, while maximizing labor productivity through
implementation of its proprietary computerized maintenance and
work management systems and by providing consulting services.

The primary focus for the business is the continental United
States, although the Company does perform services for some
international customers. Energy Management service and 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, 2003, the Company employed 92 salaried employees and
10 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 proprietary customer relationships or greater financial
resources than the Company. The Real Estate Segment also

n ABRAMS 2003 4





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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 multi-national firms to local small
businesses.

PRINCIPAL CUSTOMERS

During fiscal 2003, the Company derived
approximately 59% ($43,633,503) of its consolidated
revenues from continuing operations from direct
transactions with The Home Depot, Inc. These
revenues resulted principally from construction
activities. See Note 13 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.

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,
|                                 |               |   | 2003       |            | 2002     
|                                 |               |   |            |            |          
|Construction-contracts           |               | $ | 15,262,000 |            |           | $ | 15,178,000 |           
|Real Estate-rental income (1)    |               |   | 8,860,000  |            |           |   | 9,331,000  |           
|Real Estate-sales (2)            |               |   |           |            |           |   | 14,000,000 |           
|Energy Management-
contracts (3) |               |   | 768,000    |            |           |   | 519,000    |           
|                                 |               |   |            |            |           |   |            |           
|                                 | Total Backlog |   | $          | 24,890,000 |           |   | $          | 39,028,000 | 
|                                 |               |   |            |            |           |   |            |           



|(1) |  | The difference between 2003 and 2002 is
primarily due to rental income of
approximately $279,000 from the Englewood,
Florida, shopping center that was sold in
fiscal 2003, and scheduled lease
expirations.                                                                                                         
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | The Real Estate-sales backlog in 2002
represents the contract to sell the
Englewood shopping center. The sale closed
in June 2002.                                                                                                                                                                                   
|   
|(3) |  | Any Energy Management contract that can
be cancelled with less than one years notice is
not included in backlog. As of April 30, 2002,
and 2003, such contracts totaled $1,136,000 and
$1,139,000, respectively, 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, 2003, will be completed prior to April
30, 2004. 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, 2003.

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, except to the extent set forth under
ITEM 3. LEGAL PROCEEDINGS regarding past conduct
that possibly may have contravened antitrust laws.
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, or competitive position of
the Company.

EXECUTIVE OFFICERS OF THE REGISTRANT

The Executive Officers of the Company as of June 30, 2003, were as follows:

|                   |  |                   
|------------------ |  | ------------------
|Alan R. Abrams(48) |  | 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 also served as President and
Chief Executive Officer of Servidyne Systems, LLC
from May 2002 to July 2003.

|                       |  |                   
|---------------------- |  | ------------------
|Melinda S. Garrett(47) |  | 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.

|                     |  |                   
|-------------------- |  | ------------------
|J. Andrew Abrams(43) |  | 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.

Executive Officers of the Company are elected by
the Board of Directors of the Company or the Board
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 retired member 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 Officers or Directors of the Company.

n ABRAMS 2003   5





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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, the Real Estate Segment, and
the Construction Segment are located in this building. In addition to the
25,928 square feet of offices leased by Abrams entities, another 29,657 square
feet is leased to an unrelated tenant, and 10,295 square feet is currently
available for lease.

The Company also owns a vacant former metal manufacturing
facility located in Atlanta, Georgia.

In May 2001, the Company, through its Energy Management Segment, as part
of its acquisition of the assets of Servidyne Systems, Inc., assumed a lease,
which expires in July 2004, for 7,418 square feet of office space located at
1350 Spring Street, NW, in midtown Atlanta, Georgia.

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, Florida, shopping center, which was
co-anchored by Kmart. See Note 3 to the consolidated financial statements.
The three Kmart locations still owned by the Company, and the seven
freestanding Kmart stores that the Company developed, sold, leased back, and
then subleased to Kmart, are currently open and operating. All of these Kmart
leases were assumed by Kmart, who emerged from bankruptcy in May 2003.

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

OWNED SHOPPING CENTERS

As of April 30, 2003, the Companys Real Estate Segment owned four shopping
centers that it developed and two that it acquired. The following chart
provides relevant information relating to the owned shopping centers:

|                       |  |       |      |             |  |          |         |              |  |            |     |          |  |          |           |            |  |          |           |                 |  |             |       |      |  |   |           |           |  |           |           |  |  |   |            | 
|---------------------- |  | ----- | ---- | ----------- |  | -------- | ------- | ------------ |  | ---------- | --- | -------- |  | -------- | --------- | ---------- |  | -------- | --------- | --------------- |  | ----------- | ----- | ---- |  | - | --------- | --------- |  | --------- | --------- |  |  | - | ---------- | 
|                       |  |       |      |             |  |          |         |              |  | Percentage |     |          |  |          |           |            |  |          |           | Rental          |  |             |       |      |  |   |           |           |  | Principal
|                       |  |       |      |             |  |          |         |              |  | of Square  |     | Calendar |  |          |           |            |  | Income   |           |                 |  |             |       |      |  |   |           | Amount of
|                       |  |       |      |             |  | Leasable |         | Footage      |  | Year(s)    |     |          |  |          |           | Per Leased |  |          |           |                 |  | Debt        |       | Debt
|                       |  |       |      |             |  | Square   |         | Leased as of |  | Placed in  |     | Rental   |  | Square   |           |            |  |          |           | Service         |  | Outstanding
|                       |  |       |      |             |  | Feet in  |         | April 30,    |  | Service by |     | Income   |  | Foot     |           | EBITDA     |  | Payments |           | as of April 30,
|Location               |  | Acres |      | Building(s) |  | 2003     |         | Company      |  | 2003       |     | 2003 (1) |  | 2003 (2) |           | 2003 (3)   |  | 2003 (4)
|                       |  |       |      |             |  |          |         |              |  |            |     |          |  |          |           |            |  |         
|1100 W. Argyle Street  |  |       | 10.5 |             |  |          | 110,046 |              |  |            | 81  | %        |  |          | 1972,1996 |            |  | $        | 567,763   |                 |  | $           | 6.37  |      |  | $ | 374,090   |           |  | $         | 396,928   |  |  | $ | 2,751,537  | 
|Jackson, MI            |  |       |      |             |  |          |         |              |  |            |     |          |  |          |           |            |  |          |           |                 |  |             |       |      |  |   |           |           |  |           |           |  |  |   |            | 
|                      
|1075 W. Jackson Street |  |       | 7.3  |             |  |          | 92,120  |              |  |            | 100 |          |  |          | 1980,1992 |            |  |          | 547,570   |                 |  |             | 5.94  |      |  |   | 467,852   |           |  |           | 405,269   |  |  |   | 2,521,592  | 
|Morton, IL (5)         |  |       |      |             |  |          |         |              |  |            |     |          |  |          |           |            |  |          |           |                 |  |             |       |      |  |   |           |           |  |           |           |  |  |   |            | 
|                      
|2500 Airport Thruway   |  |       | 8.0  |             |  |          | 87,543  |              |  |            | 100 |          |  |          | 1980,1988 |            |  |          | 442,953   |                 |  |             | 5.06  |      |  |   | 394,801   |           |  |           | 391,681   |  |  |   | 1,667,048  | 
|Columbus, GA (5) (6)   |  |       |      |             |  |          |         |              |  |            |     |          |  |          |           |            |  |          |           |                 |  |             |       |      |  |   |           |           |  |           |           |  |  |   |            | 
|                      
|15201 N. Cleveland     |  |       | 72.3 |             |  |          | 293,801 |              |  |            | 97  |          |  |          | 1993,1996 |            |  |          | 2,851,717 |                 |  |             | 10.01 |      |  |   | 1,971,803 |           |  |           | 1,558,105 |  |  |   | 11,351,353 | 
|North
Ft. Myers, FL    |  |       |      |             |  |          |         |              |  |            |     |          |  |          |           |            |  |          |           |                 |  |             |       |      |  |   |           |           |  |           |           |  |  |   |            | 
|                      
|5700 Harrison Avenue   |  |       | 10.8 |             |  |          | 86,396  |              |  |            | 90  |          |  |          | 1998      |            |  |          | 645,903   |                 |  |             | 8.31  |      |  |   | 338,553   |           |  |           |          |  |  |   |           | 
|Cincinnati, OH (7)     |  |       |      |             |  |          |         |              |  |            |     |          |  |          |           |            |  |          |           |                 |  |             |       |      |  |   |           |           |  |           |           |  |  |   |            | 
|                      
|8106 Blanding Blvd.    |  |       | 18.8 |             |  |          | 174,220 |              |  |            | 89  |          |  |          | 1999      |            |  |          | 1,502,006 |                 |  |             | 9.69  |      |  |   | 1,096,442 |           |  |           | 918,750   |  |  |   | 8,600,058  | 
|Jacksonville, FL (8)   |  |       |      |             |  |          |         |              |  |            |     |          |  |          |           |            |  |          |           |                 |  |             |       |      |  |   |           |           |  |           |           |  |  |   |            | 
|                      



|(1) |  | Calculated by dividing rental income by leased square feet in
building, as of April 30, 2003.                                                                                                                                                                                                                      
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | EBITDA is defined as earnings (loss) before the following: interest,
income taxes, depreciation, and amortization of loan and lease costs. See
table following in this ITEM 2. PROPERTIES, which reconciles earnings (loss)
before income taxes from
continuing operations to EBITDA.                            
|   
|(3) |  | Includes principal and interest.                                                                                                                                                                                                                                                                                   
|   
|(4) |  | The Companys liability for repayment is limited by exculpatory
provisions to its interest in the respective mortgaged properties,
except for the loan in North Ft. Myers, Florida, which has been guaranteed by
Abrams Properties, Inc. See Notes 7 and 8 to the
consolidated financial statements of the Company.
|   
|(5) |  | Land is leased, not owned.                                                                                                                                                                                                                                                                                         
|   
|(6) |  | 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.                                                                                                                                             
|   
|(7) |  | Originally developed by others in 1982.                                                                                                                                                                                                                                                                            
|   
|(8) |  | Originally developed 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 tenant lease terms for the other owned
centers are shown in the following table:

n ABRAMS 2003   6





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|                    |  |                      |  |         |         |            |  |       |      |       |  |                     |  |  |  | 
|------------------- |  | -------------------- |  | ------- | ------- | ---------- |  | ----- | ---- | ----- |  | ------------------- |  |  |  | 
|                    |  |                      |  |         |         |            |  |       |      | 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 |  |         | 13,500  |            |  |       | 2010 |       |  | 2 For 5 years each 
|                   
|Jacksonville, FL    |  | Publix (3)           |  |         | 85,560  |            |  |       | 2010 |       |  | 6 For 5 years each 
|                    |  | Office Depot         |  |         | 22,692  |            |  |       | 2008 |       |  | 2 For 5 years each 
|                   



|(1) |  | A tenant is considered to be an Anchor Tenant if it leases 12,000
square feet or more for 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.                                    
|   
|(3) |  | Tenant has subleased the premises to Floor and Decor Outlets, but remains
responsible for lease payments until the expiration date.       

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 2003, the
Company recognized $89,782 in contingent rentals, net of offsets, which amounts
are included in the aggregate rentals set forth above.

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.

OFFICE BUILDINGS

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

|                  |  |       |      |             |  |          |         |              |  |            |    |          |  |          |      |            |  |          |           |                 |  |             |       |      |  |   |         |           |  |           |         |  |  |   |           | 
|----------------- |  | ----- | ---- | ----------- |  | -------- | ------- | ------------ |  | ---------- | -- | -------- |  | -------- | ---- | ---------- |  | -------- | --------- | --------------- |  | ----------- | ----- | ---- |  | - | ------- | --------- |  | --------- | ------- |  |  | - | --------- | 
|                  |  |       |      |             |  |          |         |              |  | Percentage |    |          |  |          |      |            |  |          |           | Rental          |  |             |       |      |  |   |         |           |  | Principal
|                  |  |       |      |             |  |          |         |              |  | of Square  |    | Calendar |  |          |      |            |  | Income   |           |                 |  |             |       |      |  |   |         | Amount of
|                  |  |       |      |             |  | Leasable |         | Footage      |  | Year(s)    |    |          |  |          |      | Per Leased |  |          |           |                 |  | Debt        |       | Debt
|                  |  |       |      |             |  | Square   |         | Leased as of |  | Placed in  |    | Rental   |  | Square   |      |            |  |          |           | Service         |  | Outstanding
|                  |  |       |      |             |  | Feet in  |         | April 30,    |  | Service by |    | Income   |  | Foot     |      | EBITDA     |  | Payments |           | as of April 30,
|Location          |  | Acres |      | Building(s) |  | 2003     |         | Company      |  | 2003       |    | 2003 (1) |  | 2003 (2) |      | 2003 (3)   |  | 2003    
|                  |  |       |      |             |  |          |         |              |  |            |    |          |  |          |      |            |  |         
|1945 The Exchange |  |       | 3.12 |             |  |          | 65,880  |              |  |            | 90 | %        |  |          | 1997 |            |  | $        | 1,126,983 |                 |  | $           | 19.01 |      |  | $ | 647,691 |           |  | $         | 435,285 |  |  | $ | 4,856,088 | 
|Atlanta, GA (4)   |  |       |      |             |  |          |         |              |  |            |    |          |  |          |      |            |  |          |           |                 |  |             |       |      |  |   |         |           |  |           |         |  |  |   |           | 
|                 
|1501-1523         |  |       |      |             |  |          |         |              |  |            |    |          |  |          |      |            |  |          |           |                 |  |             |       |      |  |   |         |           |  |           |         |  |  |   |           | 
|Johnson Ferry Rd. |  |       | 8.82 |             |  |          | 121,476 |              |  |            | 65 |          |  |          | 1997 |            |  |          | 1,539,601 |                 |  |             | 19.50 |      |  |   | 897,630 |           |  |           | 538,925 |  |  |   | 6,138,567 | 
|Marietta, GA (5)  |  |       |      |             |  |          |         |              |  |            |    |          |  |          |      |            |  |          |           |                 |  |             |       |      |  |   |         |           |  |           |         |  |  |   |           | 
|                 



|(1) |  | Calculated by dividing rental income by leased square feet in building, as
of April 30, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | EBITDA is defined as earnings (loss) before the following: interest,
income taxes, depreciation, and amortization of loan and lease costs. See
table following in this ITEM 2. PROPERTIES, which reconciles earnings
(loss) before income taxes from continuing operations to EBITDA.                                                                                                                                                                                                                        
|   
|(3) |  | Includes principal and interest.                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|(4) |  | Corporate headquarters building of which the Parent Company, Real Estate
Segment, and Construction Segment lease approximately 25,928
square feet. Rental income and cash flow includes intercompany rent at a
competitive rate of $471,842 paid by the Parent Company, Real Estate
and the Construction Segment. See ITEM 7. LIQUIDITY AND CAPITAL
RESOURCES for additional discussion regarding new
financing. Originally developed by others in 1974 and acquired and
re-developed by the Company in 1997.
|   
|(5) |  | 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, of which
5,445 square feet has been leased to third parties as of April 30, 2003. Rental
income and cash flow include intercompany rent at a competitive rate of
$154,528 paid by the Real Estate Segment. The building was
originally developed by others in 1980 and 1985.                                          

Earnings (loss) before interest, taxes, depreciation, and amortization of
loan and lease costs (EBITDA) is not a measure of performance defined in accordance with accounting principles generally accepted in the United
States of America (GAAP). However, management believes that
EBITDA is useful to investors and management in evaluating performance because
it is a commonly used financial analysis tool for measuring and
comparing individual properties in the area of operating performance. EBITDA
should not be considered as an alternative to earnings (loss) before
income taxes as an indicator of the Companys performance or as an alternative
to net cash provided by operating activities as a measure of
liquidity and may not be comparable to similarly titled measures used by other companies.
The following table reconciles earnings (loss) before income taxes
from continuing operations under GAAP to EBITDA presented in the owned shopping
center and owned office tables above:

n ABRAMS 2003 7





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##### Table of Contents



|                |                          |   |                        |         |              |   |           |         |               |   |             |         |               |   |           |         |           |   |         |         |  |   |           |         |   |   |         |         |  |   |         |         | 
|--------------- | ------------------------ | - | ---------------------- | ------- | ------------ | - | --------- | ------- | ------------- | - | ----------- | ------- | ------------- | - | --------- | ------- | --------- | - | ------- | ------- |  | - | --------- | ------- | - | - | ------- | ------- |  | - | ------- | ------- | 
|                |                          |   | OWNED SHOPPING CENTERS |         | OWNED OFFICE
|                |                          |   |                        |         |             
|                |                          |   | Jackson,               |         | Morton,      |   | Columbus, |         | N. Ft. Myers, |   | Cincinnati, |         | Jacksonville, |   | Atlanta,  |         | Marietta,
|                |                          |   | Michigan               |         | Illinois     |   | Georgia   |         | Florida       |   | Ohio        |         | Florida       |   | Georgia   |         | Georgia  
|                |                          |   |                        |         |              |   |           |         |               |   |             |         |               |   |           |         |          
|Earnings (loss) |                          |   |                        |         |              |   |           |         |               |   |             |         |               |   |           |         |           |   |         |         |  |   |           |         |   |   |         |         |  |   |         |        
|                | before income taxes from |   |                        |         |              |   |           |         |               |   |             |         |               |   |           |         |           |   |         |         |  |   |           |         |   |   |         |         |  |   |         |         | 
|                | continuing operations    |   | $                      | 61,635  |              |   | $         | 95,607  |               |   | $           | 131,564 |               |   | $         | 747,949 |           |   | $       | 281,115 |  |   | $         | (9,581  | ) |   | $       | 51,392  |  |   | $       | 88,531  | 
|Add:            |                          |   |                        |         |              |   |           |         |               |   |             |         |               |   |           |         |           |   |         |         |  |   |           |         |   |   |         |         |  |   |         |        
|                | Depreciation             |   |                        | 52,648  |              |   |           | 125,151 |               |   |             | 104,300 |               |   |           | 616,110 |           |   |         | 50,493  |  |   |           | 143,684 |   |   |         | 201,216 |  |   |         | 278,764 | 
|                | Amortization             |   |                        | 16,327  |              |   |           | 7,236   |               |   |             | 29,037  |               |   |           | 18,255  |           |   |         | 6,945   |  |   |           | 20,267  |   |   |         | 55,980  |  |   |         | 65,985  | 
|                | Interest expense         |   |                        | 243,480 |              |   |           | 239,858 |               |   |             | 129,900 |               |   |           | 589,489 |           |   |         |        |  |   |           | 942,072 |   |   |         | 339,103 |  |   |         | 464,350 | 
|                |                          |   |                        |         |              |   |           |         |               |   |             |         |               |   |           |         |           |   |         |         |  |   |           |         |   |   |         |         |  |   |         |         | 
|EBITDA          |                          | $ | 374,090                |         |              | $ | 467,852   |         |               | $ | 394,801     |         |               | $ | 1,971,803 |         |           | $ | 338,553 |         |  | $ | 1,096,442 |         |   | $ | 647,691 |         |  | $ | 897,630 |        
|                |                          |   |                        |         |              |   |           |         |               |   |             |         |               |   |           |         |           |   |         |         |  |   |           |         |   |   |         |         |  |   |         |         | 

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 2004 to 2014. The centers are 100% 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 Bayonet Point, Florida, and Orange
Park, Florida, and Davenport, Iowa, all of which have nine five-year renewal
options. 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 2003, the Company recognized $96,411 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 underground utilities,
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
payments to its interest in the respective leases.

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

|                  |  |       |      |             |  |            |         |                   |  |          |           |                 |  |         |         |  |  |   |      |  |  |   |         | 
|----------------- |  | ----- | ---- | ----------- |  | ---------- | ------- | ----------------- |  | -------- | --------- | --------------- |  | ------- | ------- |  |  | - | ---- |  |  | - | ------- | 
|                  |  |       |      |             |  | Square     |         | Calendar Years    |  | Rental   |           | Rental Income   |  | Rent   
|                  |  |       |      |             |  | Feet in    |         | Placed in Service |  | Income   |           | Per Square Foot |  | Expense
|Location          |  | Acres |      | Building(s) |  | by Company |         | 2003              |  | 2003 (1) |           | 2003           
|                  |  |       |      |             |  |            |         |                   |  |          |           |                
|Bayonet Point, FL |  |       | 10.8 |             |  |            | 109,340 |                   |  |          | 1976,1994 |                 |  | $       | 365,788 |  |  | $ | 3.35 |  |  | $ | 269,564 | 
|                 
|Orange Park, FL   |  |       | 9.4  |             |  |            | 84,180  |                   |  |          | 1976      |                 |  |         | 264,000 |  |  |   | 3.14 |  |  |   | 226,796 | 
|                 
|Davenport, IA     |  |       | 10.0 |             |  |            | 84,180  |                   |  |          | 1977      |                 |  |         | 255,308 |  |  |   | 3.03 |  |  |   | 204,645 | 
|                 
|Minneapolis, MN   |  |       | 7.1  |             |  |            | 84,180  |                   |  |          | 1978      |                 |  |         | 383,543 |  |  |   | 4.56 |  |  |   | 238,637 | 
|                 
|Ft.
Smith, AR     |  |       | 9.2  |             |  |            | 106,141 |                   |  |          | 1979,1994 |                 |  |         | 255,350 |  |  |   | 2.41 |  |  |   | 223,195 | 
|                 
|Jacksonville, FL  |  |       | 11.6 |             |  |            | 97,032  |                   |  |          | 1979      |                 |  |         | 303,419 |  |  |   | 3.13 |  |  |   | 258,855 | 
|                 
|Richfield, MN     |  |       | 5.7  |             |  |            | 74,217  |                   |  |          | 1979      |                 |  |         | 300,274 |  |  |   | 4.05 |  |  |   | 241,904 | 
|                 



|(1) |  | Calculated by dividing rental income by square feet in building.
|--- |  | ----------------------------------------------------------------

REAL
ESTATE LEASED OR HELD FOR FUTURE DEVELOPMENT OR SALE

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

|                                           |  |       |      |           |  |               |      |          |  |                                                 
|------------------------------------------ |  | ----- | ---- | --------- |  | ------------- | ---- | -------- |  | ------------------------------------------------
|                                           |  |       |      |           |  | Calendar Year |      |         
|                                           |  |       |      |           |  | Development   |      | Intended
|Location                                   |  | Acres |      | Completed |  | Use (1)      
|                                           |  |       |      |           |  |              
|Dixie Highway
Louisville, KY               |  |       | 4.7  |           |  |               | 1979 |          |  | Food store and/or retail shops                  
|                                          
|West 15th Street
Washington, NC (2)        |  |       | 1.4  |           |  |               | 1979 |          |  | Two outlots                                     
|                                          
|Mundy Mill Road
Oakwood, GA                |  |       | 5.3  |           |  |               | 1987 |          |  | Commercial development pad or up to
four outlots
|                                          
|North Cleveland Avenue
North Ft. Myers, FL |  |       | 11.6 |           |  |               | 1993 |          |  | Five outlots, anchor pads and retail shops      
|                                          
|Metropolitan Parkway
Atlanta, GA (3)       |  |       | 3.6  |           |  |               | (3)  |          |  | Warehouse, industrial or commercial
building    
|                                          



|(1) |  | Outlot as used herein refers to a small parcel of land platted separately
from the shopping center parcel, which is generally sold for, leased for, or
developed as, a fast-food restaurant, bank, or similar use.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

n ABRAMS
2003 8





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|(2) |  | Leased under leases terminating in years 2005 and 2010 with a right to
extend the term for three additional five-year periods. One
outlot is subleased for terms coextensive with the Companys lease. The
second outlot was subleased to Kmart, but was rejected
during fiscal 2003 under Kmarts Chapter 11 bankruptcy plan of
reorganization. The Company has offered to relinquish its interest
in this outlot to the landlord, and is no longer making payments under the
lease. The landlord has filed a complaint in small claims
court seeking only possession of the property.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(3) |  | Land and building, originally utilized by the Company as its
metal manufacturing facility; owned by AFC Real Estate, Inc.,
formerly known as Abrams Fixture Corporation. The Company assembled the
property in a series of transactions. The building was
developed by others prior to 1960.                                                                                                                                                                                                                                                                                           

An outlot located in Jackson, Michigan, and an outlot and anchor store
pads located in Davenport, Iowa, were all sold at a gain
during fiscal 2003. These properties are not included above.

There is no debt on any of the above properties, except for the anchor
pads and retail shop land in North Ft. Myers, Florida. See
Note 8 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.

For further information on the Companys properties see Notes 3, 5, 7, 8
and 16 to the consolidated financial statements and
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION.




ITEM 3 LEGAL PROCEEDINGS

On July 7, 2003, the Company announced that an internal investigation,
which was conducted by the Companys legal counsel at
the request of senior management, had revealed information suggesting that
behavior in violation of Federal antitrust laws may have
taken place in a certain job bidding process for one customer of the Companys
subsidiary, Abrams Construction, Inc. The results of this
investigation were reported to the Board of Directors of the Company on June 9,
2003. The Company has also voluntarily
communicated the results of its investigation to the United States Department
of Justice (DOJ) and is fully cooperating in the
subsequent inquiry that has resulted. The DOJ, on July 1, 2003, issued a
conditional letter of amnesty to the Company and its
subsidiaries for their cooperation in recognizing and then immediately
reporting the irregularities. The Company believes, based on its
internal investigation, that the specific improprieties were confined to a
bidding process for The Home Depot, Inc. (Home Depot), its
largest customer. At this time, the Company has no reason to believe that any
other customers were affected. The Company has also
communicated its concerns about the job bidding process to Home Depot. The
Company has conducted extensive additional training
of all employees and is implementing additional procedures to prevent a
recurrence of this behavior.

The Company estimates the costs associated with this matter, including the
Companys internal investigation and its ongoing
cooperation with the DOJ, are expected to approximate $750,000 in the current
fiscal year ending April 30, 2004. Such cost estimates,
however, are particularly difficult to make with any precision, and as a result
the actual costs may be lower or higher than this amount.
To date, no third party has made, or threatened to make, any claim in
connection with this matter. It is possible, however, that claims
could be made as a result of this situation.

On December 18, 2002, ASK Financial, counsel for Montgomery Ward, LLC
(Ward), filed a complaint in Bankruptcy Court
in Delaware to recover approximately $1.84 million in alleged preference
payments made by Ward to the Companys subsidiary,
Abrams Construction, Inc. (ACI), prior to Wards Chapter 11 bankruptcy filing
on December 28, 2000. Under federal bankruptcy
law, a bankrupt debtor-in-possession can sue to recover preferential payments
made to the creditors of the bankrupt debtor-in-possession during the 90-day period preceding the filing for bankruptcy
protection, subject to certain defenses, including payments
made in the ordinary course of business. The Company believes that it
has meritorious defenses to the action, and intends to continue to
vigorously defend against the claim.

On September 20, 2002, the Companys subsidiary, Abrams Properties, Inc.
(API), filed a claim in the Superior Court of Cobb
County, Georgia, against APIs former real estate asset manager. The defendant
subsequently made a demand against API for arbitration
and filed a counterclaim. During the third quarter of fiscal 2003, the Cobb
County Superior Court denied the defendants demand for
arbitration, but in July 2003, this decision was reversed by the Georgia Court
of Appeals. The Company intends to seek appellate review
of this most recent decision. The dispute arises out of the defendants former
provision of real estate asset management services to API.
The Company believes APIs counter claims against its former asset manager and
its defenses to the managers claims are meritorious and
intends to continue to vigorously pursue its claims and assert its defenses.

Other than the costs of the Companys internal investigation and ongoing
cooperation associated with the DOJ, the Company
believes the ultimate disposition of the above noted legal proceedings and
claims or potential claims will not have a material adverse
affect on the financial condition, cash flows, or results of operations of the
Company; however, the Company cannot predict the
ultimate disposition of the above noted claims, potential claims and
proceedings, and therefore, the Company cannot be certain that
the above noted legal proceedings and claims or potential claims will not have
a material adverse affect on the financial condition,
cash flows, or results of operations of the Company.




ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.

n ABRAMS 2003 9





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##### 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 2003           |       | FISCAL 2002 |  | FISCAL 2003 |       | FISCAL 2002
|               |  |                       |       |             |  |             |       |            
|               |  | HIGH                  |       | LOW         |  | HIGH        |       | LOW         |  |   |       |  |  |   |       | 
|               |  | TRADE                 |       | TRADE       |  | TRADE       |       | TRADE       |  |   |       |  |  |   |       | 
|               |  |                       |       |             |  |             |       |             |  |   |       |  |  |   |       | 
|First Quarter  |  | $                     | 5.310 |             |  | $           | 4.600 |             |  | $ | 4.240 |  |  | $ | 3.400 |  |  | $              | .040 |  |  | $ | .040 | 
|Second Quarter |  |                       | 4.840 |             |  |             | 3.370 |             |  |   | 4.200 |  |  |   | 3.800 |  |  |                | .040 |  |  |   | .040 | 
|Third Quarter  |  |                       | 4.580 |             |  |             | 3.470 |             |  |   | 3.900 |  |  |   | 3.630 |  |  |                | .040 |  |  |   | .040 | 
|Fourth Quarter |  |                       | 4.100 |             |  |             | 3.750 |             |  |   | 5.310 |  |  |   | 3.650 |  |  |                | .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 465 (including shareholders of record and shares held in street name)
at May 31, 2003.

The information contained under the heading Equity Compensation Plan in
the Companys definitive proxy materials for its 2003 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:

|                                                                |  |      |            |      |  |      |             |      |  |      |             |  |  |   |             |   |  |   |             |  
|--------------------------------------------------------------- |  | ---- | ---------- | ---- |  | ---- | ----------- | ---- |  | ---- | ----------- |  |  | - | ----------- | - |  | - | ----------- | -
|Year Ended April 30,                                            |  | 2003 |            | 2002 |  | 2001 |             | 2000 |  | 1999
|                                                                |  |      |            |      |  |      |             |      |  |     
|Net Earnings (Loss) (1)                                         |  | $    | (1,073,524 | )    |  | $    | 811,774     |      |  | $    | 676,172     |  |  | $ | (456,605    | ) |  | $ | (676,031    | )
|Net Earnings (Loss) Per Share (1)                               |  | $    | (.37       | )    |  | $    | .28         |      |  | $    | .23         |  |  | $ | (.16        | ) |  | $ | (.23        | )
|Consolidated Revenues -
Continuing Operations                   |  | $    | 74,135,347 |      |  | $    | 115,627,822 |      |  | $    | 152,622,433 |  |  | $ | 172,654,127 |   |  | $ | 170,232,540 |  
|Net Earnings (Loss) -
Continuing Operations                     |  | $    | (1,694,481 | )    |  | $    | (1,053,271  | )    |  | $    | 322,066     |  |  | $ | 2,301,833   |   |  | $ | (53,455     | )
|Net Earnings (Loss) Per Share -
Continuing Operations           |  | $    | (.58       | )    |  | $    | (.36        | )    |  | $    | .11         |  |  | $ | .78         |   |  | $ | (.02        | )
|Shares Outstanding at Year-End                                  |  |      | 2,914,351  |      |  |      | 2,909,079   |      |  |      | 2,943,303   |  |  |   | 2,936,356   |   |  |   | 2,936,356   |  
|Cash Dividends Paid Per Share                                   |  | $    | .16        |      |  | $    | .16         |      |  | $    | .16         |  |  | $ | .16         |   |  | $ | .20         |  
|Shareholders Equity                                            |  | $    | 21,257,952 |      |  | $    | 22,778,876  |      |  | $    | 22,505,543  |  |  | $ | 22,346,138  |   |  | $ | 23,272,560  |  
|Shareholders Equity Per Share                                  |  | $    | 7.29       |      |  | $    | 7.83        |      |  | $    | 7.65        |  |  | $ | 7.61        |   |  | $ | 7.93        |  
|Working Capital                                                 |  | $    | 7,638,091  |      |  | $    | 9,875,096   |      |  | $    | 11,442,348  |  |  | $ | 10,820,179  |   |  | $ | 9,885,902   |  
|Depreciation and Amortization
Expense - Continuing Operations   |  | $    | 2,326,517  |      |  | $    | 3,164,886   |      |  | $    | 2,495,327   |  |  | $ | 2,710,729   |   |  | $ | 2,343,838   |  
|Total Assets                                                    |  | $    | 73,797,098 |      |  | $    | 91,784,369  |      |  | $    | 97,619,685  |  |  | $ | 102,845,867 |   |  | $ | 126,132,540 |  
|Income-Producing Properties and
Property and Equipment, net (2) |  | $    | 43,650,850 |      |  | $    | 45,188,295  |      |  | $    | 28,134,764  |  |  | $ | 61,456,455  |   |  | $ | 64,680,003  |  
|Long-Term Debt                                                  |  | $    | 33,523,314 |      |  | $    | 35,163,492  |      |  | $    | 50,180,619  |  |  | $ | 51,929,637  |   |  | $ | 56,554,488  |  
|Interest Rate Sensitive Debt (3)                                |  | $    | 11,351,353 |      |  | $    | 16,916,652  |      |  | $    | 17,941,479  |  |  | $ | 18,302,855  |   |  | $ | 38,032,872  |  
|Return on Average Shareholders
Equity - Continuing Operations  |  |      | (7.7)%     |      |  |      | (4.7)%      |      |  |      | 1.4%        |  |  |   | 10.1%       |   |  |   | (.2)%       |  
|Return on Average
Shareholders Equity (1)                      |  |      | (4.9)%     |      |  |      | 3.6%        |      |  |      | 3.0%        |  |  |   | (2.0)%      |   |  |   | (2.8)%      |  



|(1) |  | Includes continuing operations, discontinued operations, and
extraordinary items, if any.  
|--- |  | -------------------------------------------------------------------------------------------
|   
|(2) |  | Does not include property held
for sale or real estate held for future development or sale.
|   
|(3) |  | Includes short-term and long-term debt.                                                    

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ITEM 7   MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS 
                
FOR FISCAL YEARS ENDED APRIL 30, 2003, 2002 AND 2001.

RESULTS OF OPERATIONS

REVENUES

Revenues from continuing operations for 2003 were $74,135,347, compared to
$115,627,822 and $152,622,433, for 2002 and 2001, respectively. This
represents decreases in revenues of 36% in 2003, and 24% in 2002. Revenues
include interest income of $55,317, $171,137, and $461,493, for 2003, 2002, and
2001, respectively, and other income of $65,172, $90,418, and $51,030, for
2003, 2002, and 2001, 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 |        |            |  |           |         |            |  |      |         | Years Ended |  | Increase
|                      |  | April 30,   |        | (Decrease) |  | April 30, |         | (Decrease)
|                      |  |             |        |            |  |           |         |           
|                      |  | 2003        |        | 2002       |  | Amount    |         | Percent    |  | 2002 |         | 2001        |  | Amount   |     | Percent
|                      |  |             |        |            |  |           |         |            |  |      |         |             |  |          |     |        
|Construction (1)      |  | $           | 59,528 |            |  | $         | 100,688 |            |  | $    | (41,160 | )           |  |          | (41 | )       |  | $ | 100,688 |  |  | $ | 141,118 |  |  | $ | (40,430 | ) |  |  | (29 | )
|Real Estate (2)       |  |             | 11,587 |            |  |           | 11,684  |            |  |      | (97     | )           |  |          | (1  | )       |  |   | 11,684  |  |  |   | 10,992  |  |  |   | 692     |   |  |  | 6   |  
|Energy Management (3) |  |             | 2,900  |            |  |           | 2,995   |            |  |      | (95     | )           |  |          | (3  | )       |  |   | 2,995   |  |  |   |        |  |  |   | 2,995   |   |  |  |    |  
|                      |  |             |        |            |  |           |         |            |  |      |         |             |  |          |     |         |  |   |         |  |  |   |         |  |  |   |         |   |  |  |     |  
|Total                 |  | $           | 74,015 |            |  | $         | 115,367 |            |  | $    | (41,352 | )           |  |          | (36 | )       |  | $ | 115,367 |  |  | $ | 152,110 |  |  | $ | (36,743 | ) |  |  | (24 | )
|                      |  |             |        |            |  |           |         |            |  |      |         |             |  |          |     |         |  |   |         |  |  |   |         |  |  |   |         |   |  |  |     |  

NOTES:

|(1) |  | Revenues decreased for 2003 compared to 2002 and 2002 compared to 2001
primarily due to: (a) the Companys ongoing election to reduce
revenue volume rather than continuing to bid at prices that offered the
Company unacceptable levels of potential profitability on a number
of jobs for the Companys largest customer (revenues from this customer
decreased by approximately $22.2 million in 2003 compared to
2002, and $35.7 million in 2002 compared to 2001); and (b) a limited
number of construction jobs available in a very competitive
marketplace, which is a result of a weakness in capital
spending by many retail companies. A significant portion of 2003 revenues
were from jobs the Company would not bid today based on its current
profitability criteria. In fiscal 2003, the Company increased its new
business development efforts, in order to identify customers and contracts
that place more value on the Companys high quality and high
service approach, and is exploring different commercial market sectors for
potential opportunities to broaden and increase construction
segment revenues. The Company has seen no indication that the possible
construction job bidding improprieties described in ITEM 3.
LEGAL PROCEEDINGS will negatively impact the Companys ability to achieve
future potential revenues.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Rental revenues for 2003 were $10,727,247, compared to $11,218,516 in 2002,
and $10,991,599 in 2001. Rental revenues exclude
intercompany rents of $449,549 in 2003, $461,818 in 2002, and $388,960 in
2001, which amounts were received from the Companys
other segments. Revenues from sales of real estate were $859,561 in 2003,
resulting from the sale of an outparcel in Jackson, Michigan,
and an outparcel and an anchor store pad in Davenport, Iowa, and $465,000
in 2002, resulting from the sale of an outlot in North Ft.
Myers, Florida. 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. Sales
of real estate, 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.                                                                                                                                                                                                         
|   
|(3) |  | The Energy Management Segment was formed in May 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

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 $65,881,110 for
2003, $106,619,741 for 2002, and $138,365,211 for 2001, were 89%, 92%, and 91%,
respectively.

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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,      
|                      |  |      |        |     
|                      |  | 2003 |        | 2002 |  | 2001        |         | 2003 |  | 2002 |         | 2001           
|                      |  |      |        |      |  |             |         |      |  |      |         |                
|Construction (1)      |  | $    | 57,279 |      |  | $           | 97,150  |      |  | $    | 131,821 |                 |  |                  | 96 |  |  |  | 96 |  |  |  | 93 | 
|Real Estate (2)       |  |      | 7,029  |      |  |             | 7,710   |      |  |      | 6,544   |                 |  |                  | 61 |  |  |  | 66 |  |  |  | 60 | 
|Energy Management (3) |  |      | 1,573  |      |  |             | 1,760   |      |  |      |        |                 |  |                  | 54 |  |  |  | 59 |  |  |  |   | 
|                      |  |      |        |      |  |             |         |      |  |      |         |                 |  |                  |    |  |  |  |    |  |  |  |    | 
|Total                 |  | $    | 65,881 |      |  | $           | 106,620 |      |  | $    | 138,365 |                 |  |                  | 89 |  |  |  | 92 |  |  |  | 91 | 
|                      |  |      |        |      |  |             |         |      |  |      |         |                 |  |                  |    |  |  |  |    |  |  |  |    | 

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 that began in
2002 in the Companys marketplace, and the resulting
competitive pressure on margins, which are the result of a 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 decrease in the dollar amount and percentage of costs and expenses
applicable to revenues from continuing operations for 2003
compared to 2002 is primarily attributable to: (a) lower cost of real
estate sold of approximately $110,000; (b) a decrease in lease costs
of approximately $380,000 due to the cancellation of Kmart subleases; (c)
a decrease in depreciation expense of approximately $217,000;
and (d) a decrease in management fees of approximately $217,000 paid to an
outside asset manager that only served for a partial year
in 2003; offset by (e) an increase in common area operating expenses of
approximately $233,000, primarily due to parking lot repairs.
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: (a) the cost of real estate
sold in 2002 of approximately $406,000; (b) an increase in
management fees of approximately $283,000 paid to an outside asset manager
that only served for a partial year in 2001; and (c) an
increase in depreciation expense of approximately $116,000 on the
Companys North Ft. Myers, Florida, shopping center, which was
not depreciated during the fourth quarter of 2001 as it was held for sale.
During the fourth quarter of 2002, the center was removed
from the market and reclassified to income-producing property, resulting
in recapture of the depreciation not taken in 2001.
|   
|(3) |  | The decrease in the dollar amount and percentage of costs and expenses
applicable to revenues for 2003 compared to 2002 is primarily
a result of a change in the mix of services and products sold. The Energy
Management Segment was formed in May 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

For the years 2003, 2002, and 2001, selling, general and administrative
expenses (See Chart C) were $8,046,676, $7,540,071, and
$9,857,847, respectively. As a percentage of consolidated revenues from
continuing operations, these expenses were 11%, 7%, and 6% in
2003, 2002, and 2001, respectively. In reviewing Chart C, the reader should
recognize that the volume of revenues generally affects these
amounts and percentages. 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,      
|                      |  |      |       |     
|                      |  | 2003 |       | 2002 |  | 2001        |       | 2003 |  | 2002 |       | 2001           
|                      |  |      |       |      |  |             |       |      |  |      |       |                
|Construction (1)      |  | $    | 2,426 |      |  | $           | 3,092 |      |  | $    | 6,054 |                 |  |                  | 4  |  |  |  | 3  |  |  |  | 4  | 
|Real Estate (2)       |  |      | 844   |      |  |             | 497   |      |  |      | 1,096 |                 |  |                  | 7  |  |  |  | 4  |  |  |  | 10 | 
|Energy Management (3) |  |      | 1,795 |      |  |             | 1,360 |      |  |      |      |                 |  |                  | 62 |  |  |  | 45 |  |  |  |   | 
|Parent (4)            |  |      | 2,982 |      |  |             | 2,591 |      |  |      | 2,708 |                 |  |                  | 4  |  |  |  | 2  |  |  |  | 2  | 
|                      |  |      |       |      |  |             |       |      |  |      |       |                 |  |                  |    |  |  |  |    |  |  |  |    | 
|Total                 |  | $    | 8,047 |      |  | $           | 7,540 |      |  | $    | 9,858 |                 |  |                  | 11 |  |  |  | 7  |  |  |  | 6  | 
|                      |  |      |       |      |  |             |       |      |  |      |       |                 |  |                  |    |  |  |  |    |  |  |  |    | 

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NOTES:



|(1) |  | On a dollar basis, selling, general and administrative expenses
were lower for 2003 compared to 2002, due to: (a) a $450,000
reduction in an allowance for doubtful accounts reserve for a
receivable from Montgomery Ward & Company; and (b) a
reduction in personnel and incentive compensation costs of
approximately $278,000; offset by (c) an increase in information
technology costs of approximately $122,000. On a dollar basis
comparison, the decrease in expenses in 2002 compared to 2001
was primarily due to: (a) a decrease in incentive compensation
costs of approximately $1,598,000, which are based on segment
earnings; (b) a decrease in the number of personnel; and (c) the
expense charge in 2001 of approximately $918,000 for an
allowance for doubtful accounts reserve related to a receivable from
Montgomery Ward, which had filed for bankruptcy protection.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | On a dollar and percentage basis, selling, general and
administrative expenses were higher for 2003 compared to 2002,
primarily due to (a) increased legal and professional fees of
approximately $201,000 largely attributable to: Kmarts
bankruptcy; a legal dispute with the Companys former asset
manager; and the employment of an outside consultant to assist
in asset management; and (b) increased personnel and staffing
costs of approximately $149,000 due to the Companys
reversion to internal asset management. On a dollar and
percentage basis comparison, the decrease in expenses in 2002 as
compared to 2001 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) |  | On a dollar and percentage basis, selling, general and
administrative expenses were higher for 2003 compared to 2002,
primarily due to an increase in the number of personnel and
other personnel costs and consulting fees. The Energy
Management Segment was formed in May 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   
|(4) |  | On a dollar and percentage basis, selling, general and
administrative expenses were higher for 2003 compared to
2002, primarily due to the accrual of an expense of $484,000
related to a retirement agreement, which replaced a previous
employment agreement of a former officer and director of the
Company. See Note 17 to the consolidated financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

INTEREST COSTS

Most of the interest costs expensed of $2,967,042, $3,227,253, and
$3,866,644, in 2003, 2002, and 2001, respectively, is related to debt
on real estate. Interest costs decreased in 2003 and 2002 primarily
due to a decrease in interest rates on the Companys variable rate
debt. There was no capitalized interest in any of the years presented.

FINANCIAL CONDITION AND CHANGES IN FINANCIAL CONDITION

Assets of discontinued operations decreased by $12,423,795 in
2003, due to the sale in June 2002 of the Companys shopping
center located in Englewood, Florida. See ITEM 2. PROPERTIES.

Current maturities of long-term debt decreased by $70,462,
and mortgage notes payable increased by $3,715,022, primarily
due to the refinancing of the corporate headquarters building in
Atlanta, Georgia. The prior acquisition and construction loan in
the amount of $4,279,361 was previously classified as other long-
term debt, and $317,322 was included in current maturities of
long-term debt at April 30, 2002.

Liabilities of discontinued operations decreased by $11,977,452,
primarily due to the repayment of the debt upon the Companys sale
of the shopping center located in Englewood, Florida.

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 or the
sale of income producing properties, the Company has available
bank lines of credit. See Note 8 to the consolidated financial
statements. Working capital was $7,638,091 at April 30, 2003,
compared to $9,875,096 at April 30, 2002. Operating activities
used cash of $1,816,199, which primarily consisted of a decrease in
trade and subcontractors payable. Investing activities provided cash
of $200,237. Financing activities used cash of $2,204,904,
primarily for scheduled principal payments of mortgage notes and
other long-term debt. Discontinued operations provided cash of
$1,067,300, primarily from the sale of the Companys shopping
center located in Englewood, Florida.

In 1992, the Company secured a construction loan for the
property in North Ft. Myers, Florida, from SunTrust Bank. The
original term of the construction financing was five years, and the loan
most recently was extended to August 2004, in accordance with the
loan agreement, as amended. The loan carries a floating interest rate
of prime plus .375%. As of April 30, 2003, the principal amount
outstanding was $11,351,353. The Company is currently considering
selling the property. Although the Company has regularly received
extensions on 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 sale or refinancing of the property would 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 April
2003, require the establishment of a $500,000 letter of credit, which
is to be used to pay down the loan in October 2003 if certain leasing
requirements are not met. As these requirements had not yet been
met as of April 30, 2003, the Company has classified $500,000 as
current maturities of long-term debt.

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 has the right to call the loan at any time after
September 1, 2002, upon thirteen months notice. If the loan were
called, the Company would have up to thirteen months to repay the
principal amount of the loan without penalty, by selling or refinancing
the loan on the shopping center. There can be no assurance that the
property could be refinanced or sold, and that sufficient proceeds
would be realized during the time allowed to pay off this loan.
However, the Companys liability for repayment is limited to its
interest in the center. In conjunction with the loan, an Additional

n ABRAMS 2003 13





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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 $2,721,448 at April 30, 2003. The
mortgage debt and related unamortized loan discount was
$8,600,058 and $1,732,647, respectively, at April 30, 2003.

In October 1999, the Georgia World Congress Center Authority
acquired the Companys former wood manufacturing facility located
in Atlanta, Georgia, for approximately $4.5 million. For income tax
purposes, the company treated this transaction as an involuntary
conversion under Section 1033 of the Internal Revenue Code, which
allows for the tax deferral on the gain if the Company acquires a
qualified replacement property by April 30, 2004. The Company
intends to acquire such property, primarily through the use of debt
financing, by April 30, 2004. There can be no assurance, however,
that such acquisition will take place. If a qualified replacement
property were not acquired by April 30, 2004, the Company would
be required to pay the deferred taxes of approximately $1.15 million,
which are classified as a long-term liability on the Companys
consolidated balance sheets at April 30, 2003, and 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 February 2001, 2002, and 2003, the
Companys Board authorized additional repurchases of up to
200,000 shares of the Company Stock in each of the subsequent
twelve-month periods, the most recent to end on March 4, 2004.
Any such purchases, if made, could be in the open market at
prevailing prices or in privately negotiated transactions. During
fiscal 2003, the Company repurchased a total of 128 shares at a cost
of $470. 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, 2003, and June 30, 2003.

In May
2001, the Company acquired substantially all of the assets
of an energy engineering and maintenance management 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 July 2002, the Company refinanced the loan on its
corporate headquarters building in Atlanta, Georgia, which loan
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 August 2012, and is to
be amortized on a twenty-five year schedule. In conjunction with
the refinancing of the loan, the Company is required to provide for
potential future tenant improvement expenses and lease
commissions through additional collateral, in the form of a letter
of credit, in the amount of $150,000 for each of the first three loan
years, $300,000 during the fourth, fifth, and sixth loan years, and
$450,000 during the seventh, eighth, ninth, and tenth loan years.
The $150,000 letter of credit is secured by a bank line of credit.

In April 2003, the Company leased (subject to approval by a
co-tenant, which approval has not yet been granted) 8,000 square
feet of space in its Jackson, Michigan shopping center.
In fiscal 2004, the Company plans to invest approximately $800,000 of
its available cash to complete the build-out of this space, and an
additional 13,000 square feet of adjacent shop space. The Company
also plans to market this center for sale during fiscal 2004.

Effective April 30, 2003, the Company terminated an
employment agreement and entered into a new retirement agreement
with a former officer and director of the Company. Beginning May
1, 2003, the new agreement requires the Company to pay a retirement
benefit of approximately $87,000 through August 19, 2003, and
approximately $100,000 per year thereafter for a term of four years,
ending on August 19, 2007. In addition, the Company will also
continue to provide medical insurance benefits through the term of
the retirement agreement. The new agreement accelerated the exercise date of the retirees
stock options and provided that such options expire no later than
August 19, 2004. The retirement agreement would terminate early,
in the event of the death of the retiree.

Assuming a discount rate of 5.25%, the Company has accrued
the net present value expense of $484,000 related to the retirement
agreement, which is included in selling, general and administrative
expenses in the accompanying statement of operations for fiscal
2003. As of April 30, 2003, $162,000 is included in accrued
expenses and $322,000 is included in other long-term liabilities in
the accompanying balance sheet.

The Company estimates the costs associated with the U.S.
Department of Justice investigation described under ITEM 3.
LEGAL PROCEEDINGS, including the Companys internal
investigation and its ongoing cooperation with the Justice
Department, are expected to approximate $750,000 in the current
fiscal year ending April 30, 2004. Such cost estimates, however,
are particularly difficult to make with any precision, and as a result
the actual costs may be lower or higher than this amount.

The Companys other commitments primarily include
operating leases for its leaseback shopping centers and land leased for
future development as described in ITEM 2. PROPERTIES. The
Company has no long-term commitments to purchase building
materials or other supplies.

The Company anticipates that its equity, potential proceeds
from sales of real estate, potential cash flow provided by financing or
refinancing of debt, and cash flow generated from operations will,
for the foreseeable future, provide adequate liquidity and financial
flexibility to meet the Companys needs to fund working capital,
capital expenditures, and investment activities.

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 tenant leases
are long-term (original terms over 20 years), with fixed rents,
except for some leases with 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

n ABRAMS 2003 14





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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 generally 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 used its best judgments regarding certain amounts
included in the financial statements, giving due consideration to
materiality. The application of these accounting policies involves the
exercise of judgment and the 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, and include:

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. Original contract prices are adjusted for change orders
in the amounts that are reasonably estimated based on the
Companys historical experience. The cumulative effects of changes
in estimated total contract costs and revenues (change orders) are
recorded in the period in which the facts requiring such revisions
become known, and are accounted for using the percentage-of-
completion method. At the time it is determined that a contract is
expected to 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, which are contingent on their
store sales. These percentage rents are recognized only as earned.

Revenue from the sale of real estate is recognized when all of the
following has occurred: (a) the property is transferred to the buyer; (b)
the buyers initial and continuing investment is adequate to
demonstrate a commitment to pay for the property; and (c) the buyer
has assumed all future ownership risks of the property. 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 and product
sales. Revenues are
recognized as services are rendered, and depending
upon the product type and customer agreement,
product sales are recognized when products are
shipped or delivered.

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 assets.

Property and equipment are recorded at cost,
and are depreciated for financial reporting
purposes using the straight-line method over the
estimated useful lives of the assets. Significant
additions that 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
of real estate assets are also capitalized.
Capitalization of interest and other carrying costs
are discontinued when a project is substantially
completed or if active development ceases.

Impairment of long-lived assets, including goodwill, and assets to be disposed of

Long-lived assets and certain intangible assets,
including goodwill, are required to be reviewed for
impairment on an annual basis or 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 estimated fair
value. Assets to be disposed of are reported at
the lower of their carrying amount or estimated
fair value less cost to sell.

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 August 2001, the Financial Accounting
Standards Board issued SFAS 144, Accounting for the
Impairment or Disposal of Long-Lived Assets.SFAS
144 supercedes SFAS 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 Transactions.
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

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operations. The provisions of SFAS 144 were
effective for financial statements issued for
fiscal years beginning after December 15, 2001, and
for the Company beginning May 1, 2002. The
adoption of SFAS 144 also requires that the gains
and losses from the disposition of certain
income-producing real estate assets, and the
related historical operating results, be reflected
as discontinued operations in the statements of
operations for all periods presented. Although net
earnings is not affected, the Company has
reclassified results previously included in
continuing operations to discontinued operations
for qualifying dispositions under SFAS 144.

In December 2002, SFAS 148, Accounting for
Stock-Based Compensation  Transition and
Disclosure, was issued which is an amendment of
SFAS 123, Accounting for Stock-Based Compensation.
This statement amends SFAS 123 to provide
alternative methods of transition for an entity
that voluntarily changes to the fair value based
method of accounting for stock-based employee
compensation. It also amends the disclosure
provisions of that statement to require prominent
disclosure about the effects on reported net income
of an entitys accounting policy decisions with
respect to stock-based employee compensation. The
Company elected to adopt this standard as of
January 31, 2003, resulting in additional
disclosures related to its stock-based compensation
plan.

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, estimates,
expects, plans, 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, capital spending, and
inflation could negatively impact the Company and
its customers, suppliers, and sources of capital.
Any significant negative impact from these factors
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, including, but not limited to:
the possible impact, if any, on revenues due to the
possible construction job bidding improprieties
described in ITEM 3. LEGAL PROCEEDINGS; the
ultimate disposition of legal proceedings in which
the Company is involved, including the Justice
Departments inquiry into the construction job
bidding matter just referred to; the potential loss
of significant customers; co-tenancy provisions in
anchor tenant leases; the Companys ability to sell
or refinance its real estate; the Companys ability
to acquire a qualified replacement property for tax
deferral purposes; 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; the cost and availability of
insurance; the ability of the Company to attract
and retain key personnel; weather conditions;
changes in laws and regulations, including changes
in accounting standards, generally accepted
accounting principles, and regulatory requirements
of the SEC and NASDAQ; overall capital spending
trends in the economy; the timing and amount of
earnings recognition related to the possible sale
of real estate properties held for sale; delays in
or cancellations of customers orders; the ultimate
collectibility of the Companys receivable from the
Montgomery Ward & Company bankruptcy; the ultimate
disposition of legal proceedings in which the
Company is involved; the availability, timing, and
amount of possible refinancings related to real
estate properties; the level and volatility of
interest rates; the failure of a subcontractor to
perform; and the deterioration in the financial
stability of an anchor tenant, significant
subcontractor or other significant customer.

DISCONTINUED OPERATIONS

As of April 30, 2001, the Company had deferred the
$2.76 million gain from discontinued operations
that resulted from the eminent domain taking of the
Companys former manufacturing facility in Atlanta,
Georgia. 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.

On June 28, 2002, the Company sold its
shopping center located in Englewood, Florida, and
recognized a pre-tax gain of $990,215. As a result
of the sale, the Companys financial statements
have been prepared with the propertys assets and
liabilities, results of operations, cash flows, and
the gain from the sale shown as discontinued
operations for all periods presented.

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ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Companys major market risk exposure arises from changes in interest rates
and the resulting 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, 2003, or 2002. The following
table summarizes information related to the Companys market risk sensitive
debt instruments as of April 30, 2003:

|                       |  |                             |       |      |  |      |        |      |  |      |     |       |  |       |     |       |  |  |       |   |  |        |       |   |  |  |        |      |  |           |        | 
|---------------------- |  | --------------------------- | ----- | ---- |  | ---- | ------ | ---- |  | ---- | --- | ----- |  | ----- | --- | ----- |  |  | ----- | - |  | ------ | ----- | - |  |  | ------ | ---- |  | --------- | ------ | 
|                       |  | Expected Maturity Date     
|                       |  | Fiscal year ending April 30
|                       |  |                            
|                       |  | (Dollars in Thousands)     
|                       |  |                             |       |      |  |      |        |      |  |      |     |       |  |       |     |       |  |  |       |   |  |        |       |   |  |  |        |      |  | Estimated
|                       |  |                             |       |      |  |      |        |      |  |      |     |       |  |       |     |       |  |  |       |   |  | There- |       |   |  |  |        | Fair
|                       |  | 2004                        |       | 2005 |  | 2006 |        | 2007 |  | 2008 |     | after |  | Total |     | Value
|                       |  |                             |       |      |  |      |        |      |  |      |     |       |  |       |     |      
|Fixed rate debt (1)    |  | $                           | 1,586 |      |  |      | 7,475  |      |  |      | 968 |       |  |       | 994 |       |  |  | 6,577 |   |  |        | 7,202 |   |  |  | 24,802 |      |  |           | 26,749 | 
|                       |  |                             |       |      |  |      |        |      |  |      |     |       |  |       |     |      
|Average interest rate  |  |                             | 8.0   | %    |  |      | 7.5    | %    |  |      | 8.1 | %     |  |       | 8.1 | %     |  |  | 7.5   | % |  |        | 8.2   | % |  |  |       |      |  |           |       | 
|                       |  |                             |       |      |  |      |        |      |  |      |     |       |  |       |     |      
|Variable rate debt (2) |  | $                           | 1,044 |      |  |      | 10,307 |      |  |      |    |       |  |       |    |       |  |  |      |   |  |        |      |   |  |  | 11,351 |      |  |           | 11,351 | 
|                       |  |                             |       |      |  |      |        |      |  |      |     |       |  |       |     |      



|(1) |  | Amount for 2005 includes approximately $6.9 million, net of loan discount
of approximately $1.7 million, of debt on the shopping center in Jacksonville,
Florida, which loan is not scheduled to mature until 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 plus .375%.                                                                                                                                                                                                                                                                                            




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, 2003, and 2002                                               |  | page 19
|Consolidated Statements of
Operations - For the years ended April 30, 2003, 2002, and 2001           |  | page 20
|Consolidated Statements of
Shareholders Equity - For the years ended April 30, 2003, 2002, and 2001 |  | page 21
|Consolidated Statements of Cash
Flows - For the years ended April 30, 2003, 2002, and 2001           |  | page 22
|Notes to Consolidated Financial
Statements - For the years ended April 30, 2003, 2002, and 2001      |  | page 23
|                                                                                                    
|Schedules:                                                                                           |  |        
|Schedule Number                                                                                      |  |        
|II Valuation and Qualifying Accounts                                                                 |  | page 35
|III Real Estate and Accumulated Depreciation                                                         |  | page 36

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INDEPENDENT AUDITORS REPORT

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

We have audited the accompanying consolidated balance sheets of Abrams
Industries, Inc. and subsidiaries (the Company) as of April 30,
2003 and 2002, and the related consolidated statements of operations,
shareholders equity, and cash flows for the years then ended. Our
audits also included the financial statement schedules for 2003 and 2002 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 audits.

We conducted our audits 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 audits provide 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, 2003 and 2002, and the results of their
operations and their cash flows for the years then ended, in conformity
with accounting principles generally accepted in the United States of America.
Also, in our opinion, such financial statement schedules for
2003 and 2002, when considered in relation to the basic consolidated financial
statements taken as a whole, present fairly, in all material
respects, the information set forth herein.

As discussed in Note 3 to the consolidated financial statements, effective May
1, 2002, the Company changed its method of accounting
for discontinued operations to conform to the Statement of Financial Accounting
StandardsNo. 144 and retroactively restated the 2002
and 2001 financial statements for the change.

Atlanta, Georgia
July 21, 2003

REPORT OF INDEPENDENT ACCOUNTANTS

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

In our opinion, the consolidated statement of operations, shareholders equity
and cash flows for the year ended April 30, 2001, present
fairly, in all material respects, the results of operations and cash flows of
Abrams Industries, Inc. and its subsidiaries for the year 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 for the year
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 audit.
We conducted our audit 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 audit provides 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.

-s- PricewaterhouseCoopers
Atlanta, Georgia
May 23, 2001

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CONSOLIDATED BALANCE SHEETS

|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |            |            | 
|-------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------- | ---------- | ---------- | ---- | ---------- | ---------- | ---------- | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            | April 30, 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            | 2003       |            | 2002
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |     
|ASSETS                                                   |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|CURRENT ASSETS:                                          |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         | Cash and cash equivalents                                                                                                                                       |                                                                                                                                                                                             | $          | 5,157,639  |            |      | $          | 7,911,205  |           
|                                                         | Receivables:                                                                                                                                                    |                                                                                                                                                                                             |            |            |            |      |            |            |           
|                                                         |                                                                                                                                                                 | Trade accounts and notes, net of allowance for doubtful accounts of
$44,751 in 2003 and $113,566 in 2002                                                                                    |            |            | 1,178,382  |      |            |            | 754,990    | 
|                                                         |                                                                                                                                                                 | Contracts, net of allowance for doubtful accounts of $447,294
in 2003 and $917,894 in 2002, including retained amounts of
$3,096,192 and $4,630,398 in 2003 and 2002, respectively (Note 4) |            |            | 11,231,854 |      |            |            | 11,191,925 | 
|                                                         | Assets of discontinued operations (Note 3)                                                                                                                      |                                                                                                                                                                                             |            | 102,146    |            |      |            | 12,525,941 |           
|                                                         | Costs and earnings in excess of billings (Note 4)                                                                                                               |                                                                                                                                                                                             |            | 503,113    |            |      |            | 682,162    |           
|                                                         | Income tax receivable                                                                                                                                           |                                                                                                                                                                                             |            | 171,907    |            |      |            | 843,486    |           
|                                                         | Deferred income taxes (Note 9)                                                                                                                                  |                                                                                                                                                                                             |            | 610,980    |            |      |            | 864,036    |           
|                                                         | Other                                                                                                                                                           |                                                                                                                                                                                             |            | 554,396    |            |      |            | 686,842    |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         |                                                                                                                                                                 | Total current assets                                                                                                                                                                        |            |            | 19,510,417 |      |            |            | 35,460,587 | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|INCOME-PRODUCING PROPERTIES, net (Notes 5 and 7)         |                                                                                                                                                                 |                                                                                                                                                                                             | 43,179,037 |            |            |      | 44,545,585 |           
|PROPERTY AND EQUIPMENT, net (Note 6)                     |                                                                                                                                                                 |                                                                                                                                                                                             | 471,813    |            |            |      | 642,710    |           
|OTHER ASSETS:                                            |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         | Real estate held for future development or sale                                                                                                                 |                                                                                                                                                                                             |            | 3,952,812  |            |      |            | 4,211,073  |           
|                                                         | Intangible assets, net (Note 15)                                                                                                                                |                                                                                                                                                                                             |            | 2,335,827  |            |      |            | 2,416,887  |           
|                                                         | Goodwill (Note 15)                                                                                                                                              |                                                                                                                                                                                             |            | 1,741,831  |            |      |            | 1,741,831  |           
|                                                         | Other                                                                                                                                                           |                                                                                                                                                                                             |            | 2,605,361  |            |      |            | 2,765,696  |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         |                                                                                                                                                                 | $                                                                                                                                                                                           | 73,797,098 |            |            | $    | 91,784,369 |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|LIABILITIES AND SHAREHOLDERS EQUITY                     |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|CURRENT LIABILITIES:                                     |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         | Trade
and subcontractors payables, including retained amounts
of $1,064,989 and $1,776,684 in 2003 and 2002, respectively                                       |                                                                                                                                                                                             | $          | 6,163,796  |            |      | $          | 8,028,199  |           
|                                                         | Accrued expenses                                                                                                                                                |                                                                                                                                                                                             |            | 1,831,990  |            |      |            | 1,637,525  |           
|                                                         | Billings in excess of costs and earnings (Note 4)                                                                                                               |                                                                                                                                                                                             |            | 682,674    |            |      |            | 677,987    |           
|                                                         | Liabilities of discontinued operations (Note 3)                                                                                                                 |                                                                                                                                                                                             |            | 563,584    |            |      |            | 12,541,036 |           
|                                                         | Current maturities of long-term debt                                                                                                                            |                                                                                                                                                                                             |            | 2,630,282  |            |      |            | 2,700,744  |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         |                                                                                                                                                                 | Total current liabilities                                                                                                                                                                   |            |            | 11,872,326 |      |            |            | 25,585,491 | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|DEFERRED INCOME TAXES (Note 9)                           |                                                                                                                                                                 |                                                                                                                                                                                             | 2,772,132  |            |            |      | 4,359,894  |           
|OTHER LIABILITIES                                        |                                                                                                                                                                 |                                                                                                                                                                                             | 4,371,374  |            |            |      | 3,896,616  |           
|MORTGAGE NOTES PAYABLE, LESS CURRENT MATURITIES (Note 7) |                                                                                                                                                                 |                                                                                                                                                                                             | 23,216,407 |            |            |      | 19,501,385 |           
|OTHER LONG-TERM DEBT, less current maturities (Note 8)   |                                                                                                                                                                 |                                                                                                                                                                                             | 10,306,907 |            |            |      | 15,662,107 |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         |                                                                                                                                                                 | Total liabilities                                                                                                                                                                           |            |            | 52,539,146 |      |            |            | 69,005,493 | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|COMMITMENTS AND CONTINGENCIES (Notes 7, 8 and 17)        |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|SHAREHOLDERS EQUITY (Note 11):                          |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         | Common
stock, $1 par value; 5,000,000 shares authorized;
3,060,239 issued and 2,914,351 outstanding in 2003,
3,054,439 issued and 2,909,079 outstanding in 2002 |                                                                                                                                                                                             |            | 3,060,239  |            |      |            | 3,054,439  |           
|                                                         | Additional paid-in capital                                                                                                                                      |                                                                                                                                                                                             |            | 2,153,505  |            |      |            | 2,135,005  |           
|                                                         | Deferred stock compensation                                                                                                                                     |                                                                                                                                                                                             |            | (16,598    | )          |      |            | (12,744    | )         
|                                                         | Retained earnings                                                                                                                                               |                                                                                                                                                                                             |            | 16,734,753 |            |      |            | 18,273,853 |           
|                                                         | Treasury
stock, common shares, 145,888 in 2003 and 145,360 in 2002                                                                                              |                                                                                                                                                                                             |            | (673,947   | )          |      |            | (671,677   | )         
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         |                                                                                                                                                                 | Total shareholders equity                                                                                                                                                                  |            |            | 21,257,952 |      |            |            | 22,778,876 | 
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           
|                                                         |                                                                                                                                                                 | $                                                                                                                                                                                           | 73,797,098 |            |            | $    | 91,784,369 |           
|                                                         |                                                                                                                                                                 |                                                                                                                                                                                             |            |            |            |      |            |           

See accompanying notes to consolidated financial statements.

n ABRAMS 2003 19





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##### Table of Contents



CONSOLIDATED STATEMENTS OF OPERATIONS

|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |         | 
|---------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------- | ---------- | --------------------- | ---------- | ---- | ----------- | ----------- | ---------- | - | ----------- | ----------- | ------- | 
|                                         |                                                                                                                                                       |                                                                |            | Years Ended April 30,
|                                         |                                                                                                                                                       |                                                                |            |                      
|                                         |                                                                                                                                                       |                                                                |            | 2003                  |            | 2002 |             | 2001       
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |            
|REVENUES:                                |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |            
|                                         | Construction                                                                                                                                          |                                                                | $          | 59,527,859            |            |      | $           | 100,687,872 |            |   | $           | 141,118,311 |        
|                                         | Rental income                                                                                                                                         |                                                                |            | 10,727,247            |            |      |             | 11,218,516  |            |   |             | 10,991,599  |        
|                                         | Real estate sales                                                                                                                                     |                                                                |            | 859,561               |            |      |             | 465,000     |            |   |             |            |        
|                                         | Energy management                                                                                                                                     |                                                                |            | 2,900,191             |            |      |             | 2,994,879   |            |   |             |            |        
|                                         | Interest                                                                                                                                              |                                                                |            | 55,317                |            |      |             | 171,137     |            |   |             | 461,493     |        
|                                         | Other                                                                                                                                                 |                                                                |            | 65,172                |            |      |             | 90,418      |            |   |             | 51,030      |        
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       |                                                                | 74,135,347 |                       |            |      | 115,627,822 |             |            |   | 152,622,433 |            
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|COSTS AND EXPENSES:                      |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |            
|                                         | Construction                                                                                                                                          |                                                                |            | 57,278,712            |            |      |             | 97,149,635  |            |   |             | 131,821,216 |        
|                                         | Rental property operating expenses,excluding interest                                                                                                 |                                                                |            | 6,733,159             |            |      |             | 7,304,452   |            |   |             | 6,543,995   |        
|                                         | Cost of real estate sold                                                                                                                              |                                                                |            | 295,813               |            |      |             | 405,647     |            |   |             |            |        
|                                         | Energy management                                                                                                                                     |                                                                |            | 1,573,426             |            |      |             | 1,760,007   |            |   |             |            |        
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       |                                                                | 65,881,110 |                       |            |      | 106,619,741 |             |            |   | 138,365,211 |            
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|Selling, general and administrative      |                                                                                                                                                       |                                                                | 8,046,676  |                       |            |      | 7,540,071   |             |            |   | 9,857,847   |            
|Interest costs incurred                  |                                                                                                                                                       |                                                                | 2,967,042  |                       |            |      | 3,227,253   |             |            |   | 3,866,644   |            
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       |                                                                | 76,894,828 |                       |            |      | 117,387,065 |             |            |   | 152,089,702 |            
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       | (LOSS) EARNINGS BEFORE INCOME TAXES FROM
CONTINUING OPERATIONS |            |                       | (2,759,481 | )    |             |             | (1,759,243 | ) |             |             | 532,731 | 
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|INCOME TAX (BENEFIT) EXPENSE (Note 9):   |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |            
|                                         | Current                                                                                                                                               |                                                                |            | (171,907              | )          |      |             | (605,773    | )          |   |             | 412,198     |        
|                                         | Deferred                                                                                                                                              |                                                                |            | (893,093              | )          |      |             | (100,199    | )          |   |             | (201,533    | )      
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       |                                                                | (1,065,000 | )                     |            |      | (705,972    | )           |            |   | 210,665     |            
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       | (LOSS) EARNINGS FROM CONTINUING OPERATIONS                     |            |                       | (1,694,481 | )    |             |             | (1,053,271 | ) |             |             | 322,066 | 
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|DISCONTINUED OPERATIONS (Note 3):        |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |            
|                                         | Earnings from discontinued operations, adjusted
for applicable income tax expense of $3,413 in 2003,
$89,729 in 2002, and $218,048 in 2001            |                                                                |            | 2,970                 |            |      |             | 144,296     |            |   |             | 354,106     |        
|                                         | Gain on sale of assets of discontinued operations,
adjusted for applicable income tax expense of
$372,228 in 2003, $1,056,000 in 2002, and $0 in 2001 |                                                                |            | 617,987               |            |      |             | 1,720,749   |            |   |             |            |        
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       | EARNINGS FROM DISCONTINUED OPERATIONS                          |            |                       | 620,957    |      |             |             | 1,865,045  |   |             |             | 354,106 | 
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       | NET (LOSS) EARNINGS                                            |            | $                     | (1,073,524 | )    |             | $           | 811,774    |   |             | $           | 676,172 | 
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|NET (LOSS) EARNINGS PER SHARE (Note 12): |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |            
|                                         | From continuing operations - basic and diluted                                                                                                        |                                                                | $          | (.58                  | )          |      | $           | (.36        | )          |   | $           | .11         |        
|                                         | From discontinued operations - basic and diluted                                                                                                      |                                                                |            | .21                   |            |      |             | .64         |            |   |             | .12         |        
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        
|                                         |                                                                                                                                                       | Net (loss) earnings per share - basic and diluted              |            | $                     | (.37       | )    |             | $           | .28        |   |             | $           | .23     | 
|                                         |                                                                                                                                                       |                                                                |            |                       |            |      |             |             |            |   |             |             |        

See accompanying notes to consolidated financial statements.

n ABRAMS 2003 20





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##### Table of Contents



CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY

|                           |                                          |  |              |        |            |   |           |        |              |   |           |        |       |   |         |          |   |   |            |            |   |   |          |          |   |   |            |            |  
|-------------------------- | ---------------------------------------- |  | ------------ | ------ | ---------- | - | --------- | ------ | ------------ | - | --------- | ------ | ----- | - | ------- | -------- | - | - | ---------- | ---------- | - | - | -------- | -------- | - | - | ---------- | ---------- | -
|                           |                                          |  |              |        |            |   |           |        |              |   |           |        |       |   |         |          |   |   |            |            |   |   |          |          |  
|                           |                                          |  | Common Stock |        | Additional |   | Deferred  |        |              |   |           |        |       |   |        
|                           |                                          |  |              |        | Paid-in    |   | Stock     |        | Retained     |   | Treasury  |        |       |   |        
|                           |                                          |  | Shares       |        | Amount     |   | Capital   |        | Compensation |   | Earnings  |        | Stock |   | Total  
|                           |                                          |  |              |        |            |   |           |        |              |   |           |        |       |   |        
|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 |           
|                           | Net loss                                 |  |              |       |            |   |           |       |              |   |           |       |       |   |         |         |   |   |            | (1,073,524 | ) |   |          |         |   |   |            | (1,073,524 | )
|                           | Common stock acquired                    |  |              |       |            |   |           |       |              |   |           |       |       |   |         |         |   |   |            |            |   |   |          | (2,270   | ) |   |            | (2,270     | )
|                           | Common stock issued                      |  |              | 5,800  |            |   |           | 5,800  |              |   |           | 18,500 |       |   |         | (24,300  | ) |   |            |           |   |   |          |         |   |   |            |           |  
|                           | Stock compensation expense               |  |              |       |            |   |           |       |              |   |           |       |       |   |         | 20,446   |   |   |            |           |   |   |          |         |   |   |            | 20,446     |  
|                           | Cash dividends declared -
$.16 per share |  |              |       |            |   |           |       |              |   |           |       |       |   |         |         |   |   |            | (465,576   | ) |   |          |         |   |   |            | (465,576   | )
|                           |                                          |  |              |        |            |   |           |        |              |   |           |        |       |   |         |          |   |   |            |            |   |   |          |          |   |   |            |           
|BALANCES at
April 30, 2003 |                                          |  | 3,060,239    |        |            | $ | 3,060,239 |        |              | $ | 2,153,505 |        |       | $ | (16,598 | )        |   | $ | 16,734,753 |            |   | $ | (673,947 | )        |   | $ | 21,257,952 |           
|                           |                                          |  |              |        |            |   |           |        |              |   |           |        |       |   |         |          |   |   |            |            |   |   |          |          |   |   |            |           

See accompanying notes to consolidated financial statements.

n ABRAMS 2003 21





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##### Table of Contents



CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |            |            |  
|-------------------------------------------------------- | ---------------------------------------------------------------------------------------------------- | ----------------------------------------------- | --------------------------------------------------- | ----------- | --------------------- | ---------- | ---------- | ---------- | ---------- | ---------- | ---------- | ---------- | ---------- | ---------- | -
|                                                         |                                                                                                      |                                                 |                                                     |             | Years Ended April 30,
|                                                         |                                                                                                      |                                                 |                                                     |             |                      
|                                                         |                                                                                                      |                                                 |                                                     |             | 2003                  |            | 2002       |            | 2001      
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |           
|Cash flows from operating activities:                    |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |           
|                                                         | Net (loss) earnings                                                                                  |                                                 | $                                                   | (1,073,524  | )                     |            | $          | 811,774    |            |            | $          | 676,172    |           
|                                                         | Adjustments to reconcile net (loss) earnings to net
cash (used in) provided by operating activities: |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|                                                         |                                                                                                      | Income from discontinued operations, net of tax |                                                     |             | (620,957              | )          |            |            | (1,865,045 | )          |            |            | (354,106   | )         
|                                                         |                                                                                                      | Depreciation and amortization                   |                                                     |             | 2,326,517             |            |            |            | 3,164,886  |            |            |            | 2,495,327  |           
|                                                         |                                                                                                      | Deferred tax benefit                            |                                                     |             | (1,334,706            | )          |            |            | (1,062,587 | )          |            |            | (176,897   | )         
|                                                         |                                                                                                      | Provision for doubtful accounts                 |                                                     |             | (539,415              | )          |            |            | 69,999     |            |            |            | 936,684    |           
|                                                         |                                                                                                      | Gain on sale of real estate                     |                                                     |             | (563,748              | )          |            |            | (59,353    | )          |            |            |           |           
|                                                         | Changes in assets and liabilities:                                                                   |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|                                                         |                                                                                                      | Receivables, net                                |                                                     |             | 737,490               |            |            |            | 2,431,245  |            |            |            | 4,512,394  |           
|                                                         |                                                                                                      | Costs and earnings in excess of billings        |                                                     |             | 179,049               |            |            |            | 801,033    |            |            |            | 835,907    |           
|                                                         |                                                                                                      | Other current assets                            |                                                     |             | 132,446               |            |            |            | 108,244    |            |            |            | (246,959   | )         
|                                                         |                                                                                                      | Other assets                                    |                                                     |             | 156,335               |            |            |            | 421,256    |            |            |            | (115,120   | )         
|                                                         |                                                                                                      | Trade and subcontractors payable                |                                                     |             | (1,864,403            | )          |            |            | (764,797   | )          |            |            | (4,569,982 | )         
|                                                         |                                                                                                      | Accrued expenses                                |                                                     |             | 169,272               |            |            |            | (1,357,839 | )          |            |            | (1,682,467 | )         
|                                                         |                                                                                                      | Accrued profit-sharing                          |                                                     |             |                      |            |            |            | (1,277,917 | )          |            |            | (51,129    | )         
|                                                         |                                                                                                      | Billings in excess of costs and earnings        |                                                     |             | 4,687                 |            |            |            | (828,779   | )          |            |            | 217,652    |           
|                                                         |                                                                                                      | Other liabilities                               |                                                     |             | 474,758               |            |            |            | (73,271    | )          |            |            | (66,620    | )         
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|                                                         |                                                                                                      |                                                 | Net cash (used in) provided by operating activities |             |                       | (1,816,199 | )          |            |            | 518,849    |            |            |            | 2,410,856  |  
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|Cash flows from investing activities:                    |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |           
|                                                         | Proceeds from sales of real estate and property and equipment                                        |                                                 |                                                     | 847,203     |                       |            |            | 407,837    |            |            |            |           |           
|                                                         | Additions to intangible assets                                                                       |                                                 |                                                     | (283,552    | )                     |            |            |           |            |            |            |           |           
|                                                         | Additions
to income-producing properties, net                                                        |                                                 |                                                     | (260,522    | )                     |            |            | (339,207   | )          |            |            |           |           
|                                                         | Additions
to property, equipment, and other, net                                                     |                                                 |                                                     | (113,075    | )                     |            |            | (512,056   | )          |            |            | (437,412   | )         
|                                                         | Acquisition, net of cash acquired                                                                    |                                                 |                                                     |            |                       |            |            | (2,971,663 | )          |            |            |           |           
|                                                         | Repayments received on notes receivable                                                              |                                                 |                                                     | 10,183      |                       |            |            | 94,096     |            |            |            | 127,510    |           
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|                                                         |                                                                                                      |                                                 | Net cash provided by (used in) investing activities |             |                       | 200,237    |            |            |            | (3,320,993 | )          |            |            | (309,902   | )
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|Cash flows from financing activities:                    |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |           
|                                                         | Debt proceeds                                                                                        |                                                 |                                                     | 4,900,000   |                       |            |            |           |            |            |            |           |           
|                                                         | Debt repayments                                                                                      |                                                 |                                                     | (6,529,270  | )                     |            |            | (2,056,947 | )          |            |            | (1,317,391 | )         
|                                                         | Deferred loan costs paid                                                                             |                                                 |                                                     | (107,788    | )                     |            |            | (5,000     | )          |            |            | (5,000     | )         
|                                                         | Repurchase of common stock                                                                           |                                                 |                                                     | (2,270      | )                     |            |            | (183,046   | )          |            |            | (76,080    | )         
|                                                         | Cash dividends                                                                                       |                                                 |                                                     | (465,576    | )                     |            |            | (468,835   | )          |            |            | (470,218   | )         
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|                                                         |                                                                                                      |                                                 | Net cash used in financing activities               |             |                       | (2,204,904 | )          |            |            | (2,713,828 | )          |            |            | (1,868,689 | )
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|Cash flows from discontinued operations:                 |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |           
|                                                         | Operating activities                                                                                 |                                                 |                                                     | (215,901    | )                     |            |            | 1,978,427  |            |            |            | 3,947,511  |           
|                                                         | Mortgage payoff                                                                                      |                                                 |                                                     | (12,206,700 | )                     |            |            |           |            |            |            |           |           
|                                                         | Proceeds from sale of property, net of costs of sale                                                 |                                                 |                                                     | 13,489,901  |                       |            |            |           |            |            |            |           |           
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|                                                         |                                                                                                      |                                                 | Net cash provided by discontinued operations        |             |                       | 1,067,300  |            |            |            | 1,978,427  |            |            |            | 3,947,511  |  
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|Net (decrease) increase in cash and cash equivalents     |                                                                                                      |                                                 | (2,753,566                                          | )           |                       |            | (3,537,545 | )          |            |            | 4,179,776  |           
|Cash and cash equivalents at beginning of year           |                                                                                                      |                                                 | 7,911,205                                           |             |                       |            | 11,448,750 |            |            |            | 7,268,974  |           
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|Cash and cash equivalents at end of year                 |                                                                                                      | $                                               | 5,157,639                                           |             |                       | $          | 7,911,205  |            |            | $          | 11,448,750 |           
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           
|Supplemental disclosure of noncash investing activities: |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |           
|                                                         | Transfer of income-producing property to property held for sale                                      |                                                 | $                                                   |            |                       |            | $          |           |            |            | $          | 31,896,809 |           
|                                                         | 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: |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |           
|                                                         | Issuance of common stock under Stock Award Plan                                                      |                                                 | $                                                   | 24,300      |                       |            | $          | 51,090     |            |            | $          | 104,625    |           
|Supplemental schedule of cash flow information:          |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |           
|                                                         | Cash paid during the year for interest                                                               |                                                 | $                                                   | 2,678,985   |                       |            | $          | 4,092,065  |            |            | $          | 4,781,850  |           
|                                                         | Cash (refunded) paid during the year for income taxes, net                                           |                                                 | $                                                   | (351,871    | )                     |            | $          | 202,716    |            |            | $          | 249,811    |           
|                                                         |                                                                                                      |                                                 |                                                     |             |                       |            |            |            |            |            |            |            |           

See accompanying notes to consolidated financial statements.

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Notes to Consolidated Financial Statements

APRIL 30, 2003, 2002, AND 2001

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) commercial construction (ii) real estate
investment and development, and (iii) energy management. The
Companys wholly owned subsidiaries include Abrams Construction,
Inc., the Construction Segment; Abrams Properties, Inc. and
subsidiaries, and AFC Real Estate, Inc., the Real Estate Segment;
and Abrams Power, Inc. and its subsidiary, Servidyne Systems, LLC,
the Energy Management Segment. Previously the Company
engaged in the property management of its real estate. In fiscal year
2001, the Company outsourced all of the asset and property
management duties for the Companys properties owned or controlled
by the Real Estate Segment to third parties. In fiscal 2003, the
Company brought back in house the asset management
responsibilities and the property management of one owned shopping
center and all of the leaseback centers.

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, 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. Original contract prices are adjusted for change orders
in the amounts that are reasonably estimated based on the
Companys historical experience. The cumulative effects of changes
in estimated total contract costs and revenues (change orders) are
recorded in the period in which the facts requiring such revisions
become known, and are accounted for using the percentage-of-completion method. At the time it is determined that a contract is
expected to 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, which are contingent on their store sales. These
percentage rents are recognized only as earned.

Revenue from the sale of real estate is recognized when all of the
following has occurred: (a) the property is transferred to the buyer;
(b) the buyers initial and continuing investment is adequate to
demonstrate a commitment to pay for the property; and (c) the buyer
has assumed all future ownership risks of the property. 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 and
product sales. Revenues are recognized as services are rendered, and
depending upon the product type and customer agreement, product
sales are recognized when products are shipped or delivered.

(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.

(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 are recorded at cost, and are
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 of real estate assets are also capitalized. Capitalization
of interest and other carrying costs are 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.

(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, including goodwill,
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

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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.

(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 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 by the
Companys bankers for similar debt instruments of comparable
maturities. 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                   
|Proprietary customer software solutions |  | 4-5 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. 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, 2003, and 2002, the Company had no
derivative instruments.

(n)  Stock Compensation
In December 2002, SFAS 148, Accounting for Stock-Based
Compensation  Transition and Disclosure, was issued which is an
amendment of SFAS 123, Accounting for Stock-Based Compensation.
This statement amends SFAS 123 to provide alternative methods of
transition for an entity that voluntarily changes to the fair value
based method of accounting for stock-based employee
compensation. It also amends the disclosure provisions of that
statement to require prominent disclosure about the effects on
reported net income of an entitys accounting policy decisions with
respect to stock-based employee compensation. The Company
elected to adopt this standard as of January 31, 2003, resulting in
additional disclosures related to its stock-based compensation plan.

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 2003 and 2002 using the Black-Scholes option
pricing model. The weighted average fair value of options granted is
$1.18 and $1.05, for 2003 and 2002, respectively. The fair value of
each option grant as of the date of grant has been estimated using the
Black-Scholes option pricing model, with the following weighted
average assumptions for grants in 2003 and 2002, respectively: risk-
free interest rates of 3.22% and 4.65%, and 4.93%; expected lives of
5 and 10 years, and 5 years; dividend yields of 3.68% and 4.16%; and
expected volatility of 33% and 42%.

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.

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

|                                                                                                                                      |                                 |   |            |      |      |   |         |     |  |   |         |     | 
|------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------- | - | ---------- | ---- | ---- | - | ------- | --- |  | - | ------- | --- | 
|                                                                                                                                      |                                 |   | 2003       |      | 2002 |   | 2001   
|                                                                                                                                      |                                 |   |            |      |      |   |        
|Net (loss) earnings, as reported                                                                                                      |                                 | $ | (1,073,524 | )    |      | $ | 811,774 |     |  | $ | 676,172 |    
|Deduct: Total stock-based compensation
expense as determined under fair value
based method for all awards, net of
related tax effects |                                 |   | (198,756   | )    |      |   | (46,869 | )   |  |   |        |    
|                                                                                                                                      |                                 |   |            |      |      |   |         |     |  |   |         |    
|Pro forma net (loss) earnings                                                                                                         |                                 | $ | (1,272,280 | )    |      | $ | 764,905 |     |  | $ | 676,172 |    
|                                                                                                                                      |                                 |   |            |      |      |   |         |     |  |   |         |    
|Net (loss) earnings per share:                                                                                                        |                                 |   |            |      |      |   |         |     |  |   |         |    
|                                                                                                                                      | Basic and diluted - as reported |   | $          | (.37 | )    |   | $       | .28 |  |   | $       | .23 | 
|                                                                                                                                      | Basic and diluted - pro forma   |   | $          | (.44 | )    |   | $       | .26 |  |   | $       | .23 | 

(o)  Reclassifications
Certain reclassifications have been made to the 2002 and 2001 consolidated
financial statements to conform to classifications adopted in 2003.

3 DISCONTINUED OPERATIONS

Effective May 1, 2002, the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets, which requires, among other
things, that the operating results of certain income-producing assets, sold subsequent to April 30, 2002, be included in
discontinued operations in the statements of operations for all
periods presented. On June 28, 2002, the Company sold its shopping center
located in Englewood, Florida, and recognized a pre-tax gain of $990,215. As a result of the sale, the Companys financial
statements have been prepared with the propertys assets and
liabilities, results of operations, cash flows, and the gain from the sale
shown as discontinued operations. 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 Companys former manufacturing segments
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. 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. All historical statements have been restated in accordance with
SFAS 144. Summarized financial information for
discontinued operations for the fiscal years ended April 30 is as follows:

|                                                        |  |      |         |      |  |      |           |  |  |   |           | 
|------------------------------------------------------- |  | ---- | ------- | ---- |  | ---- | --------- |  |  | - | --------- | 
|                                                        |  | 2003 |         | 2002 |  | 2001
|                                                        |  |      |         |      |  |     
|Revenues                                                |  | $    | 289,173 |      |  | $    | 1,969,865 |  |  | $ | 2,508,496 | 
|Operating expenses, including amortization and interest |  |      | 282,790 |      |  |      | 1,735,840 |  |  |   | 1,936,342 | 
|                                                        |  |      |         |      |  |      |           |  |  |   |           | 
|                                                        |  | $    | 6,383   |      |  | $    | 234,025   |  |  | $ | 572,154   | 
|                                                        |  |      |         |      |  |      |           |  |  |   |           | 

|                                   |  |                |         |                |  |   |            | 
|---------------------------------- |  | -------------- | ------- | -------------- |  | - | ---------- | 
|                                   |  | Balances at   
|                                   |  |               
|                                   |  | April 30, 2003 |         | April 30, 2002
|                                   |  |                |         |               
|Assets of discontinued operations: |  |                |         |                |  |   |            | 
|Property held for sale             |  | $              |        |                |  | $ | 12,502,037 | 
|Receivables                        |  |                | 57,020  |                |  |   | 16,713     | 
|Other                              |  |                | 45,126  |                |  |   | 7,191      | 
|                                   |  |                |         |                |  |   |            | 
|                                   |  | $              | 102,146 |                |  | $ | 12,525,941 | 
|                                   |  |                |         |                |  |   |            | 

|                                        |  |                |         |                |  |   |            | 
|--------------------------------------- |  | -------------- | ------- | -------------- |  | - | ---------- | 
|                                        |  | Balances at   
|                                        |  |               
|                                        |  | April 30, 2003 |         | April 30, 2002
|                                        |  |                |         |               
|Liabilities of discontinued operations: |  |                |         |                |  |   |            | 
|Mortgage debt                           |  | $              |        |                |  | $ | 12,206,700 | 
|Accounts payable                        |  |                |        |                |  |   | 10,764     | 
|Income taxes                            |  |                | 476,635 |                |  |   | 242,091    | 
|Accrued expenses                        |  |                | 86,949  |                |  |   | 81,481     | 
|                                        |  |                |         |                |  |   |            | 
|                                        |  | $              | 563,584 |                |  | $ | 12,541,036 | 
|                                        |  |                |         |                |  |   |            | 

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ABRAMS 2002 25





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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:

|                                          |  |      |            |      |  |   |            | 
|----------------------------------------- |  | ---- | ---------- | ---- |  | - | ---------- | 
|                                          |  | 2003 |            | 2002
|                                          |  |      |            |     
|Costs and earnings in excess of billings: |  |      |            |      |  |   |            | 
|Accumulated costs and earnings            |  | $    | 16,324,508 |      |  | $ | 26,769,091 | 
|Amounts billed                            |  |      | 15,821,395 |      |  |   | 26,086,929 | 
|                                          |  |      |            |      |  |   |            | 
|                                          |  | $    | 503,113    |      |  | $ | 682,162    | 
|                                          |  |      |            |      |  |   |            | 
|Billings in excess of costs and earnings: |  |      |            |      |  |   |            | 
|Amounts billed                            |  | $    | 17,349,809 |      |  | $ | 37,142,812 | 
|Accumulated costs and earnings            |  |      | 16,667,135 |      |  |   | 36,464,825 | 
|                                          |  |      |            |      |  |   |            | 
|                                          |  | $    | 682,674    |      |  | $ | 677,987    | 
|                                          |  |      |            |      |  |   |            | 

5 INCOME-PRODUCING PROPERTIES

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

|                                                 |  |              |  |      |            |      |            |  |            |   |            | 
|------------------------------------------------ |  | ------------ |  | ---- | ---------- | ---- | ---------- |  | ---------- | - | ---------- | 
|                                                 |  | Estimated    |  |      |            |      |            |  |            |  
|                                                 |  | useful lives |  | 2003 |            | 2002
|                                                 |  |              |  |      |            |     
|Land                                             |  |              |  |      |            | $    | 13,777,053 |  |            | $ | 13,777,053 | 
|Buildings and improvements                       |  | 7-39 years   |  |      | 46,294,096 |      |            |  | 46,060,629 |  
|                                                 |  |              |  |      |            |      |            |  |            |   |            | 
|                                                 |  |              |  |      |            |      | 60,071,149 |  |            |   | 59,837,682 | 
|Less - accumulated depreciation and amortization |  |              |  |      |            |      | 16,892,112 |  |            |   | 15,292,097 | 
|                                                 |  |              |  |      |            |      |            |  |            |   |            | 
|                                                 |  |              |  |      |            | $    | 43,179,037 |  |            | $ | 44,545,585 | 
|                                                 |  |              |  |      |            |      |            |  |            |   |            | 

Depreciation expense for the years ended April 30, 2003, 2002, and 2001, was
$1,619,116, $1,808,125, and $1,445,733, respectively.

6 PROPERTY AND EQUIPMENT

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

|                                |  |              |  |      |           |      |           |   |           |   |           | 
|------------------------------- |  | ------------ |  | ---- | --------- | ---- | --------- | - | --------- | - | --------- | 
|                                |  | Estimated    |  |      |           |      |           |   |           |  
|                                |  | useful lives |  | 2003 |           | 2002
|                                |  |              |  |      |           |     
|Building improvements           |  | 3-39 years   |  | $    | 309,460   |      |           | $ | 309,460   |  
|Vehicles and equipment          |  | 3-10 years   |  |      | 1,654,701 |      |           |   | 1,771,733 |  
|                                |  |              |  |      |           |      |           |   |           |   |           | 
|                                |  |              |  |      |           |      | 1,964,161 |   |           |   | 2,081,193 | 
|Less - accumulated depreciation |  |              |  |      |           |      | 1,492,348 |   |           |   | 1,438,483 | 
|                                |  |              |  |      |           |      |           |   |           |   |           | 
|                                |  |              |  |      |           | $    | 471,813   |   |           | $ | 642,710   | 
|                                |  |              |  |      |           |      |           |   |           |   |           | 

Depreciation expense for the years ended April 30, 2003, 2002, and 2001, was
$269,026, $366,739, and $425,235, respectively.

7 LEASES AND MORTGAGE NOTES PAYABLE

As of April 30, 2003, the Company owned six shopping centers, an office park,
an office building and a former manufacturing facility. Of
the owned properties, four of the six shopping centers and both office
properties were pledged as collateral on related mortgage notes payable.
Exculpatory provisions of the mortgage notes limit the Companys liability for
repayment to its interest in the respective mortgaged properties.
The Company also leases seven shopping centers under leaseback arrangements
expiring on various dates between fiscal years 2004 to 2014.
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. As of
April 30, 2003, Kmart was also a tenant in three of the six
Company-owned shopping centers. The owned shopping centers are leased to
tenants for terms expiring on various dates from fiscal 2004 to
2021, while leases on the office properties expire from fiscal years 2004 to
2012. 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
tenants 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 volume exceeds a predetermined amount. In some cases, the
shopping center leases provide that the tenant bear the cost of
insurance, repairs, maintenance, and taxes. Base rental revenue recognized
from owned shopping centers and office properties in 2003, 2002,
and 2001, was approximately $7,268,000, $7,347,000, and $7,320,000,
respectively. Base rental revenue recognized from leaseback centers
in 2003, 2002, and 2001, was approximately $2,031,000, $2,497,000, and
$2,620,000, respectively. Contingent rental revenue on all centers
in 2003, 2002, and 2001, was approximately $186,000, $174,000, and $161,000,
respectively.

n ABRAMS 2003 26





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

|                      |  |       |            |           |  |   |           | 
|--------------------- |  | ----- | ---------- | --------- |  | - | --------- | 
|Year ending April 30, |  | Owned |            | Leaseback
|                      |  |       |            |          
|2004                  |  | $     | 6,843,000  |           |  | $ | 2,032,000 | 
|2005                  |  |       | 6,108,000  |           |  |   | 1,800,000 | 
|2006                  |  |       | 5,580,000  |           |  |   | 1,476,000 | 
|2007                  |  |       | 5,056,000  |           |  |   | 888,000   | 
|2008                  |  |       | 4,602,000  |           |  |   | 618,000   | 
|Thereafter            |  |       | 23,489,000 |           |  |   | 1,846,000 | 
|                      |  |       |            |           |  |   |           | 
|                      |  | $     | 51,678,000 |           |  | $ | 8,660,000 | 
|                      |  |       |            |           |  |   |           | 

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 the leaseback centers, are as follows:

|                      |  |                         |            |                |  |          |           |  |  |   |           | 
|--------------------- |  | ----------------------- | ---------- | -------------- |  | -------- | --------- |  |  | - | --------- | 
|                      |  | Owned Rental Properties |            |                |  |         
|                      |  | Mortgage Payments       |            | Leaseback     
|                      |  |                         |            | Centers Rental
|Year ending April 30, |  | Principal               |            | Interest       |  | Payments
|                      |  |                         |            |                |  |         
|2004                  |  | $                       | 1,585,836  |                |  | $        | 2,006,389 |  |  | $ | 1,656,000 | 
|2005                  |  |                         | 7,474,897  |                |  |          | 1,339,634 |  |  |   | 1,462,000 | 
|2006                  |  |                         | 967,628    |                |  |          | 1,213,172 |  |  |   | 1,146,000 | 
|2007                  |  |                         | 994,429    |                |  |          | 1,131,948 |  |  |   | 515,000   | 
|2008                  |  |                         | 6,577,237  |                |  |          | 916,044   |  |  |   | 287,000   | 
|Thereafter            |  |                         | 7,202,216  |                |  |          | 2,433,707 |  |  |   | 867,000   | 
|                      |  |                         |            |                |  |          |           |  |  |   |           | 
|                      |  | $                       | 24,802,243 |                |  | $        | 9,040,894 |  |  | $ | 5,933,000 | 
|                      |  |                         |            |                |  |          |           |  |  |   |           | 

The mortgage notes payable are due at various dates between January 1, 2008,
and September 1, 2019, and bear interest at rates ranging
from 7.25% to 9.25%. At April 30, 2003, the weighted average rate for all
outstanding debt was 6.8%, including other long-term debt
and credit facilities (See Note 8).

In conjunction with the origination of a mortgage on an income-producing
property, 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 $2,721,448 and
$2,384,945, at April 30, 2003, and 2002, respectively. The related unamortized
loan discount was $1,732,647 and $1,651,276, at April 30,
2003, and 2002, respectively.

8 OTHER LONG-TERM DEBT AND CREDIT FACILITIES

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

|                                                                                                                                                                                                                                                                                                                                    |                            |   |            |            |      |   |            |            | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | - | ---------- | ---------- | ---- | - | ---------- | ---------- | 
|                                                                                                                                                                                                                                                                                                                                    |                            |   | 2003       |            | 2002
|                                                                                                                                                                                                                                                                                                                                    |                            |   |            |            |     
|Real estate construction loan
bearing interest at the prime rate plus .375%
(4.625% at April 30, 2003); requires monthly principal and interest
payments of $87,729; matures August 29, 2004; secured by real
property and assignment of leases and rents                                                                           |                            | $ | 7,249,849  |            |      | $ | 7,925,172  |           
|                                                                                                                                                                                                                                                                                                                                   
|Amendment to the construction loan shown above,currently permitting
borrowings of up to $4,942,419; bearing interest at the prime rate
plus .375% (4.625% at April 30, 2003); requires monthly principal
and interest payments of $42,113; matures August 29, 2004; secured
by real property and the assignment of leases and rents |                            |   | 4,101,504  |            |      |   | 4,394,797  |           
|                                                                                                                                                                                                                                                                                                                                   
|Note payable to a bank,with variable interest rate of LIBOR plus 2%
(3.879% at April 30, 2002); required monthly principal payments of
$41,047; refinanced in July 2002, as discussed below                                                                                                                                         |                            |   |           |            |      |   | 4,596,683  |           
|                                                                                                                                                                                                                                                                                                                                    |                            |   |            |            |      |   |            |           
|                                                                                                                                                                                                                                                                                                                                    | Total other long-term debt |   |            | 11,351,353 |      |   |            | 16,916,652 | 
|Less current maturities                                                                                                                                                                                                                                                                                                             |                            |   | 1,044,446  |            |      |   | 1,254,545  |           
|                                                                                                                                                                                                                                                                                                                                    |                            |   |            |            |      |   |            |           
|Total other long-term debt, less current maturities                                                                                                                                                                                                                                                                                 |                            | $ | 10,306,907 |            |      | $ | 15,662,107 |           
|                                                                                                                                                                                                                                                                                                                                    |                            |   |            |            |      |   |            |           

n ABRAMS 2003 27





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

|                      |  |   |            | 
|--------------------- |  | - | ---------- | 
|Year Ending April 30, |  |   |            | 
|                      |  |   |            | 
|2004                  |  | $ | 1,044,446  | 
|2005                  |  |   | 10,306,907 | 
|                      |  |   |            | 
|                      |  | $ | 11,351,353 | 
|                      |  |   |            | 

At April 30, 2003, the Company had commitments from a bank for unsecured lines
of credit totaling $9 million, of which a total
of $650,000 is restricted as it secures letters 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 any unused portion. The lines
of credit expire on October 30, 2003. At April
30, 2003, 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 December 31, 2003.
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 one of the bank lines of credit,
as discussed above.

In July 2002, the Company refinanced the loan on its corporate headquarters
building in Atlanta, Georgia, which prior loan 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. Pursuant to the provisions of the new
permanent loan, the Company is required to provide for potential future tenant
improvement costs and lease commissions through
additional collateral, in the form of a letter of credit in the amount of
$150,000 for each of the first three loan years, $300,000 during
the fourth, fifth, and sixth loan years, and $450,000 during the seventh,
eighth, ninth and tenth loan years. The $150,000 letter of
credit is secured by one of the bank lines of credit, as discussed above.

9 INCOME TAXES

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

|                          |  |         |          |          |  |       |          |   |  |   |            |  
|------------------------- |  | ------- | -------- | -------- |  | ----- | -------- | - |  | - | ---------- | -
|                          |  | Current |          | Deferred |  | Total
|                          |  |         |          |          |  |      
|Year ended April 30, 2003 |  |         |          |          |  |       |          |   |  |   |            |  
|Federal                   |  | $       | (171,907 | )        |  | $     | (752,078 | ) |  | $ | (923,985   | )
|State and local           |  |         |         |          |  |       | (141,015 | ) |  |   | (141,015   | )
|                          |  |         |          |          |  |       |          |   |  |   |            |  
|                          |  | $       | (171,907 | )        |  | $     | (893,093 | ) |  | $ | (1,065,000 | )
|                          |  |         |          |          |  |       |          |   |  |   |            |  
|Year ended April 30, 2002 |  |         |          |          |  |       |          |   |  |   |            |  
|Federal                   |  | $       | (553,121 | )        |  | $     | (95,011  | ) |  | $ | (648,132   | )
|State and local           |  |         | (52,652  | )        |  |       | (5,188   | ) |  |   | (57,840    | )
|                          |  |         |          |          |  |       |          |   |  |   |            |  
|                          |  | $       | (605,773 | )        |  | $     | (100,199 | ) |  | $ | (705,972   | )
|                          |  |         |          |          |  |       |          |   |  |   |            |  
|Year ended April 30, 2001 |  |         |          |          |  |       |          |   |  |   |            |  
|Federal                   |  | $       | 349,819  |          |  | $     | (186,947 | ) |  | $ | 162,872    |  
|State and local           |  |         | 62,379   |          |  |       | (14,586  | ) |  |   | 47,793     |  
|                          |  |         |          |          |  |       |          |   |  |   |            |  
|                          |  | $       | 412,198  |          |  | $     | (201,533 | ) |  | $ | 210,665    |  
|                          |  |         |          |          |  |       |          |   |  |   |            |  

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
|                                                    |                                                                           |   |                    
|                                                    |                                                                           |   | 2003                |          | 2002 |   | 2001    
|                                                    |                                                                           |   |                     |          |      |   |         
|Computed
expected tax (benefit) expense           |                                                                           | $ | (938,224            | )        |      | $ | (598,143 | )        |   | $ | 181,129 |       
|(Decrease) increase in income taxes resulting from: |                                                                           |   |                     |          |      |   |          |          |   |   |         |       
|                                                    | State and local income taxes, net
of federal income tax (benefit) expense |   |                     | (126,776 | )    |   |          | (107,829 | ) |   |         | 29,636 |  
|                                                    | Other, net                                                                |   |                     |         |      |   |          |         |   |   |         | (100   | )
|                                                    |                                                                           |   |                     |          |      |   |          |          |   |   |         |       
|                                                    |                                                                           | $ | (1,065,000          | )        |      | $ | (705,972 | )        |   | $ | 210,665 |       
|                                                    |                                                                           |   |                     |          |      |   |          |          |   |   |         |       

n ABRAMS
2003 28





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The tax effect of the 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:

|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |           | 
|------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------- | - | --------- | --------- | ---- | - | --------- | --------- | 
|                                                 |                                                                                                                                     |                                     |   | 2003      |           | 2002
|                                                 |                                                                                                                                     |                                     |   |           |           |     
|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                                                                                                    |                                     |   | 1,579,861 |           |      |   | 314,992   |          
|                                                 | Capitalized costs                                                                                                                   |                                     |   | 407,450   |           |      |   | 477,721   |          
|                                                 | Accrued directors fees                                                                                                             |                                     |   | 170,283   |           |      |   | 177,524   |          
|                                                 | Bad debt reserve                                                                                                                    |                                     |   | 191,364   |           |      |   | 409,163   |          
|                                                 | Deferred compensation plan                                                                                                          |                                     |   | 461,468   |           |      |   | 498,722   |          
|                                                 | Compensated absences                                                                                                                |                                     |   | 86,471    |           |      |   | 84,992    |          
|                                                 | Other accrued expenses                                                                                                              |                                     |   | 441,805   |           |      |   | 211,475   |          
|                                                 | Other                                                                                                                               |                                     |   | 184,000   |           |      |   | 379,458   |          
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          
|                                                 |                                                                                                                                     | Gross deferred income tax assets    |   |           | 4,549,518 |      |   |           | 3,580,863 | 
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          
|Deferred income tax liabilities:                 |                                                                                                                                     |                                     |   |           |           |      |   |          
|                                                 | Income-producing properties and property and equipment, principally
because of differences in depreciation and capitalized interest |                                     |   | 1,707,847 |           |      |   | 1,671,917 |          
|                                                 | Gain on real estate sales structured as tax-deferred like-kind exchanges                                                            |                                     |   | 5,002,823 |           |      |   | 5,279,104 |          
|                                                 | Other                                                                                                                               |                                     |   |          |           |      |   | 125,700   |          
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          
|                                                 |                                                                                                                                     | Gross deferred income tax liability |   |           | 6,710,670 |      |   |           | 7,076,721 | 
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          
|                                                 |                                                                                                                                     | Net deferred income tax liability   |   | $         | 2,161,152 |      |   | $         | 3,495,858 | 
|                                                 |                                                                                                                                     |                                     |   |           |           |      |   |           |          

There was no valuation allowance
against deferred tax assets at April 30, 2003, and 2002. In managements opinion it is more likely
than not that such deferred tax assets are realizable.

10 DEFERRED PROFIT-SHARING AND 401(K) PLAN

The Company has a deferred profit-sharing plan (the Plan) which covers the
majority of its employees. Effective January 1, 2003, the
Company amended the Plan to add a 401(k) feature covering eligible employees.
Pursuant to the provisions of the Plan, eligible
employees may make salary deferral (before tax) contributions of up to 100% of
their total compensation per plan year, not to exceed
a specified maximum contribution as determined by the Internal Revenue Service.
The Plan also includes provisions that authorize the
Company to make discretionary contributions. Such contributions, if made, are
allocated among all eligible employees as determined
under the Plan. The trustee under the Plan invests the assets of each
participants account, as directed by the participant. The Plan assets
do not include any stock of the Company. Funded employer contributions to the
Plan for 2003, 2002, and 2001, were approximately
$18,000, $60,000, and $634,000, respectively. The net assets in the Plan,
which is administered by an independent trustee, were
approximately $8,204,000, $9,290,000, and $13,234,000, at April 30, 2003, 2002,
and 2001, respectively.

In conjunction with the acquisition of the assets of Servidyne Systems, Inc. in
fiscal 2002, the Company assumed a 401(k) plan (the
Servidyne Plan), which covered substantially all employees of the Energy
Management segment. Under the provisions of the Servidyne
Plan, participants could contribute up to 100% of their compensation per plan
year, not to exceed a specified maximum contribution, as
determined by the Internal Revenue Service. The Company could also make
discretionary contributions, and did make contributions of
approximately $19,500 and $15,000, in 2003 and 2002, respectively. The
Servidyne Plan was frozen as of January 1, 2003, and no more
employee or employer contributions were funded after that date. All employees
of the Energy Management Segment are eligible to
participate in the Companys deferred profit-sharing and 401(k) plan as
described above.

11 STOCK COMPENSATION

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 originally
available for grant under the Award Plan was 1,000,000 shares.

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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. On May 18, 2001,
the Company granted a restricted stock award to
certain eligible employees, which vested on May 18,
2002. On November 28, 2001, the Company granted a
restricted stock award to an eligible employee,
which vested on November 28, 2002. On July 29,
2002, the Company granted a restricted stock award
to certain eligible employees, which will vest on
July 29, 2003, as long as the individual grantee
continues to be employed by the Company until the
vesting date. On March 11, 2003, the Company
granted a restricted stock award to certain
eligible employees, certain consultants, and
certain independent contractors, which will vest on
March 11, 2004, as long as the individual grantee
continues to be employed by the Company until the
vesting date. During fiscal 2003, 2002, and 2001,
forfeitures of restricted shares, which did not
vest, totaled 400, 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, 2003, 2002,
and 2001, was $20,446, $113,440, and $29,531,
respectively. As of April 30, 2003, after
forfeitures during the year, there were 5,400
shares outstanding under restricted stock award
grants, which were not yet vested.

As allowed under Statement of Financial Accounting
Standards (SFAS) 123, Accounting for Stock-Based
Compensation, the Company accounts 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 are accounted for under SFAS 123, and
compensation expense is 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
vested in May 2003. In July 2002, the Company
issued an additional 355,856 incentive stock
options to certain employees, and 253,144
non-qualified stock options to the Companys
directors, certain employees, and an independent
contractor, one-half of which will
vest in July 2003 and the remaining one-half of
which will vest in July 2004, as long as the
individual grantee continues to be employed by the
Company until the respective vesting dates. All of
the options issued in July 2002 have an exercise
price of $5.10 per share. At April 30, 2003, and
2002, 85,308 and 0 options were vested,
respectively.

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 February 2001, 2002, and 2003, 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 most
recent to end on March 4, 2004. During fiscal 2001,
2002, and 2003, the Company repurchased 20,053
shares, 44,524 shares, and 128 shares,
respectively, of Common Stock.

12 NET EARNINGS (LOSS) PER SHARE

Earnings per share is calculated in accordance with
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.
Basic earnings per share are computed by dividing
net earnings by the weighted average shares
outstanding during the reporting period. Dilutive
potential common shares are calculated in
accordance with the treasury stock method, which
assumes that the proceeds from the exercise of all
options are used to repurchase common shares at
current market value. The number of shares
remaining after the exercise proceeds are exhausted
represents the potentially dilutive effect of the
options. Options to purchase 747,250 shares were
outstanding at April 30, 2003. The dilutive number
of common shares for the fourth quarter 2003 and
2002, were 2,912,659 and 2,933,395, respectively;
and for the fiscal year ended 2003 and 2002, were
2,919,203 and 2,930,340, respectively. Since the
Company had losses from continuing operations for
all periods presented, all stock equivalents were
antidilutive during these periods, and are
therefore excluded from weighted average shares
outstanding.

n ABRAMS 2003 30





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

|                                                            |  |                                   |            |               |  |           |           |  |  |   |      |  
|----------------------------------------------------------- |  | --------------------------------- | ---------- | ------------- |  | --------- | --------- |  |  | - | ---- | -
|                                                            |  | For the year ended April 30, 2003
|                                                            |  |                                  
|                                                            |  | Earnings (loss)                   |            | Shares        |  | Per share
|                                                            |  | (numerator)                       |            | (denominator) |  | amount   
|                                                            |  |                                   |            |               |  |          
|Basic EPS - loss per share from continuing operations       |  | $                                 | (1,694,481 | )             |  |           | 2,910,475 |  |  | $ | (.58 | )
|Basic EPS - earnings per share from discontinued operations |  |                                   | 620,957    |               |  |           | 2,910,475 |  |  |   | .21  |  
|Effect of dilutive securities                               |  |                                   |           |               |  |           |          |  |  |   |     |  
|                                                            |  |                                   |            |               |  |           |           |  |  |   |      |  
|Diluted EPS - loss per share plus assumed conversions       |  | $                                 | (1,073,524 | )             |  |           | 2,910,475 |  |  | $ | (.37 | )
|                                                            |  |                                   |            |               |  |           |           |  |  |   |      |  

|                                                            |  |                                   |            |               |  |           |           |  |  |   |      |  
|----------------------------------------------------------- |  | --------------------------------- | ---------- | ------------- |  | --------- | --------- |  |  | - | ---- | -
|                                                            |  | For the year ended April 30, 2002
|                                                            |  |                                  
|                                                            |  | Earnings (loss)                   |            | Shares        |  | Per share
|                                                            |  | (numerator)                       |            | (denominator) |  | amount   
|                                                            |  |                                   |            |               |  |          
|Basic EPS - loss per share from continuing operations       |  | $                                 | (1,053,271 | )             |  |           | 2,926,248 |  |  | $ | (.36 | )
|Basic EPS - earnings per share from discontinued operations |  |                                   | 1,865,045  |               |  |           | 2,926,248 |  |  |   | .64  |  
|Effect of dilutive securities                               |  |                                   |           |               |  |           |          |  |  |   |     |  
|                                                            |  |                                   |            |               |  |           |           |  |  |   |      |  
|Diluted EPS - earnings per share plus assumed conversions   |  | $                                 | 811,774    |               |  |           | 2,926,248 |  |  | $ | .28  |  
|                                                            |  |                                   |            |               |  |           |           |  |  |   |      |  

|                                                            |  |                                   |         |               |  |           |           |  |  |   |     | 
|----------------------------------------------------------- |  | --------------------------------- | ------- | ------------- |  | --------- | --------- |  |  | - | --- | 
|                                                            |  | For the year ended April 30, 2001
|                                                            |  |                                  
|                                                            |  | Earnings                          |         | Shares        |  | Per share
|                                                            |  | (numerator)                       |         | (denominator) |  | amount   
|                                                            |  |                                   |         |               |  |          
|Basic EPS - earnings per share from continuing operations   |  | $                                 | 322,066 |               |  |           | 2,938,504 |  |  | $ | .11 | 
|Basic EPS - earnings per share from discontinued operations |  |                                   | 354,106 |               |  |           | 2,938,504 |  |  |   | .12 | 
|Effect of dilutive securities                               |  |                                   |        |               |  |           |          |  |  |   |    | 
|                                                            |  |                                   |         |               |  |           |           |  |  |   |     | 
|Diluted EPS - earnings per share plus assumed conversions   |  | $                                 | 676,172 |               |  |           | 2,938,504 |  |  | $ | .23 | 
|                                                            |  |                                   |         |               |  |           |           |  |  |   |     | 

13 OPERATING SEGMENTS

The Company had three operating segments at April 30, 2003: Construction, Real
Estate, and Energy Management. The Construction
Segments activities consist primarily of construction, expansion, remodeling
and renovation of retail store buildings, banks, shopping
centers, warehouses and distribution centers, and other types of commercial
construction. Although, the Construction Segment does work throughout
much of the United States, it concentrates its activities principally
in the southern and midwestern states.
The Real Estate Segment is involved in the
investment and development of shopping centers and office properties in the
Southeast and Midwest. The Energy Management
Segment, which began in fiscal 2002, assists its customers in reducing the
costs of operating buildings by lowering energy consumption
and increasing work efficiency through its: (1) engineering and consulting
services; (2) utility monitoring and analysis; and (3)
equipment maintenance and work management. The primary focus for the
Energy Management Segment is the continental United States, although
it does perform services for some international customers.

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 respective segment primarily based on the earnings
or losses prior to income taxes, cash flows, and activities consistent with the
Companys long-term strategic objectives. 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.

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 59%, 56%, and 66% of consolidated revenues from continuing
operations in 2003, 2002, and 2001, respectively.
Revenues from Academy Sports & Outdoor, generated entirely in the Construction
Segment, totaled 18% of consolidated revenues in
2002, but were less than 10% of consolidated revenues in 2003 and 2001.

Earnings (loss) before income taxes 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 earnings (loss) before income taxes
from continuing operations of each segment, represent the actual costs incurred
by that segment. It excludes any extraordinary items.
Parent expenses have not been allocated to the subsidiaries in the following
table.

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, the cash
surrender value of life insurance, receivables, and assets related to
deferred compensation plans. Liquid assets attributable to the Companys former
manufacturing segments discontinued operations are also included
in the Parent Companys assets in 2003, 2002, and 2001.

n ABRAMS 2003 31





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13 OPERATING SEGMENTS continued

|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |            |  
|------------------------------------ | --------------------------------------------- | - | ------------ | ---------- | ----------- | - | ---------- | ---------- | ------ | - | ------------ | --------- | ------------ | - | ---------- | ---------- | - | - | ----------- | --------- | - | - | ---------- | ---------- | -
|                                     |                                               |   |              |            |             |   |            |            |        |   | Energy       |           |              |   |            |            |   |   |             |           |   |   |           
|                                     |                                               |   | Construction |            | Real Estate |   | Management |            | Parent |   | Eliminations |           | Consolidated
|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |             
|2003                                 |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           
|Revenues from unaffiliated
customers |                                               | $ | 59,527,859   |            |             | $ | 11,586,808 |            |        | $ | 2,900,191    |           |              | $ |           |            |   | $ |            |           |   | $ | 74,014,858 |           
|Interest and other income            |                                               |   | 9,903        |            |             |   | 94,550     |            |        |   |             |           |              |   | 22,342     |            |   |   | (6,306      | )         |   |   | 120,489    |           
|Intersegment revenue                 |                                               |   |             |            |             |   | 449,549    |            |        |   |             |           |              |   |           |            |   |   | (449,549    | )         |   |   |           |           
|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           
|                                     | Total revenues from
continuing operations     |   | $            | 59,537,762 |             |   | $          | 12,130,907 |        |   | $            | 2,900,191 |              |   | $          | 22,342     |   |   | $           | (455,855  | ) |   | $          | 74,135,347 |  
|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           
|Earnings (loss)                      |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           
|                                     | before income taxes
fromcontinuing operations |   | $            | (1,832,730 | )           |   | $          | 702,540    |        |   | $            | (566,852  | )            |   | $          | (3,277,435 | ) |   | $           | 2,214,996 |   |   | $          | (2,759,481 | )
|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           
|Segment assets                       |                                               | $ | 15,073,267   |            |             | $ | 54,413,919 |            |        | $ | 3,624,372    |           |              | $ | 13,043,446 |            |   | $ | (12,357,906 | )         |   | $ | 73,797,098 |           
|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           
|Interest expense                     |                                               | $ | 942          |            |             | $ | 2,946,901  |            |        | $ | 7,912        |           |              | $ | 11,287     |            |   | $ |            |           |   | $ | 2,967,042  |           
|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           
|Depreciation and amortization        |                                               | $ | 246,783      |            |             | $ | 1,838,013  |            |        | $ | 222,155      |           |              | $ | 47,034     |            |   | $ | (27,468     | )         |   | $ | 2,326,517  |           
|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           
|Capital expenditures                 |                                               | $ | 67,050       |            |             | $ | 264,986    |            |        | $ | 31,810       |           |              | $ | 18,404     |            |   | $ |            |           |   | $ | 382,250    |           
|                                     |                                               |   |              |            |             |   |            |            |        |   |              |           |              |   |            |            |   |   |             |           |   |   |            |           

|                                     |                                                |   |              |             |             |   |            |            |        |   |              |           |              |   |            |            |   |   |            |          |   |   |             |             |  
|------------------------------------ | ---------------------------------------------- | - | ------------ | ----------- | ----------- | - | ---------- | ---------- | ------ | - | ------------ | --------- | ------------ | - | ---------- | ---------- | - | - | ---------- | -------- | - | - | ----------- | ----------- | -
|                                     |                                                |   |              |             |             |   |            |            |        |   | Energy       |           |              |   |            |            |   |   |            |          |   |   |            
|                                     |                                                |   | Construction |             | Real Estate |   | Management |            | Parent |   | Eliminations |           | Consolidated
|                                     |                                                |   |              |             |             |   |            |            |        |   |              |           |             
|2002                                 |                                                |   |              |             |             |   |            |            |        |   |              |           |              |   |            |            |   |   |            |          |   |   |             |            
|Revenues from unaffiliated
customers |                                                | $ | 100,687,872  |             |             | $ | 11,683,516 |            |        | $ | 2,994,879    |           |              | $ |           |            |   | $ |           |          |   | $ | 115,366,267 |            
|Interest and other income            |                                                |   | 60,537       |             |             |   | 156,068    |            |        |   |             |           |              |   | 55,188     |            |   |   | (10,238    | )        |   |   | 261,555     |            
|Intersegment revenue                 |                                                |   |             |             |             |   | 461,818    |            |        |   |             |           |              |   |           |            |   |   | (461,818   | )        |   |   |            |            
|                                     |                                                |   |              |             |             |   |            |            |        |   |              |           |              |   |            |            |   |   |            |          |   |   |             |            
|                                     | Total revenues from
continuing operations      |   | $            | 100,748,409 |             |   | $          | 12,301,402 |        |   | $            | 2,994,879 |              |   | $          | 55,188     |   |   | $          | (472,056 | ) |   | $           | 115,627,822 |  
|                                     |                                                |   |              |             |             |   |            |            |        |   |              |           |              |   |            |            |   |   |            |          |   |   |             |            
|Earnings (loss)                      |                                                |   |              |             |             |   |            |            |        |   |              |           |              |   |            |            |   |   |            |          |   |   |             |            
|                                     | before income taxes
from continuing operations |   | $            | 243,344     |             |   | $          | 859,689    |        |   | $            | (135,945  | )            |   | $          | (2,785,300 | ) |   | $          | 58,969   |   |   | $           | (1,759,243  | )
|                                     |                                                |   |              |             |             |   |            |            |        |   |              |           |              |   |            |            |   |   |            |          |   |   |             |            
|Segment assets                       |                                                | $ | 18,011,119   |             |             | $ | 67,143,652 |            |        | $ | 3,452,921    |           |              | $ | 12,843,051 |            |   | $ | (9,666,374 | )        |   | $ | 91,784,369  |            
|                                     |                                                |   |              |             |             |   |            |            |        |   |              |           |              |   |            |            |   |   |            |          |   |   |             |            
|Interest expense                     |                                                | $ | 5,255        |             |             | $ | 3,203,642  |            |        | $ | 10,431       |           |              | $ | 7,925      |            |   | $ |           |          |   | $ | 3,227,253   |            
|                                     |                                                |   |              |             |             |   |            |            |        |   |              |           |              |   |            |            |   |   |            |          |   |   |             |            
|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       |   |              |   |            |            |   |   |            |          |   |   |            
|                                     |                                                |   | Construction |             | Real Estate |   | Management (1) |            | Parent |   | Eliminations |   | Consolidated
|                                     |                                                |   |              |             |             |   |                |            |        |   |              |   |             
|2001                                 |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            
|Revenues from unaffiliated
customers |                                                | $ | 141,118,311  |             |             | $ | 10,991,599     |            |        | $ |             |   |              | $ |           |            |   | $ |           |          |   | $ | 152,109,910 |            
|Interest and other income            |                                                |   | 241,679      |             |             |   | 240,310        |            |        |   |             |   |              |   | 30,534     |            |   |   |           |          |   |   | 512,523     |            
|Intersegment revenue                 |                                                |   | 28,060       |             |             |   | 388,960        |            |        |   |             |   |              |   |           |            |   |   | (417,020   | )        |   |   |            |            
|                                     |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            
|                                     | Total revenues from
continuing operations      |   | $            | 141,388,050 |             |   | $              | 11,620,869 |        |   | $            |  |              |   | $          | 30,534     |   |   | $          | (417,020 | ) |   | $           | 152,622,433 | 
|                                     |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            
|Earnings (loss)                      |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            
|                                     | before income taxes
from continuing operations |   | $            | 3,194,897   |             |   | $              | 111,888    |        |   | $            |  |              |   | $          | (2,819,777 | ) |   | $          | 45,723   |   |   | $           | 532,731     | 
|                                     |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            
|Segment assets                       |                                                | $ | 23,293,006   |             |             | $ | 69,459,677     |            |        | $ |             |   |              | $ | 11,779,447 |            |   | $ | (6,912,445 | )        |   | $ | 97,619,685  |            
|                                     |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            
|Interest expense                     |                                                | $ | 12,106       |             |             | $ | 3,835,604      |            |        | $ |             |   |              | $ | 18,934     |            |   | $ |           |          |   | $ | 3,866,644   |            
|                                     |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            
|Depreciation and amortization        |                                                | $ | 420,241      |             |             | $ | 2,048,863      |            |        | $ |             |   |              | $ | 56,004     |            |   | $ | (29,781    | )        |   | $ | 2,495,327   |            
|                                     |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            
|Capital expenditures                 |                                                | $ | 303,541      |             |             | $ | 97,862         |            |        | $ |             |   |              | $ | 4,989      |            |   | $ |           |          |   | $ | 406,392     |            
|                                     |                                                |   |              |             |             |   |                |            |        |   |              |   |              |   |            |            |   |   |            |          |   |   |             |            



|(1) |  | The Energy Management Segment was formed in May 2001.
|--- |  | -----------------------------------------------------

n ABRAMS 2003 32





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14 NEW ACCOUNTING PRONOUNCEMENTS

During August 2001, the Financial Accounting
Standards Board issued SFAS 144, Accounting for the
Impairment or Disposal of Long-Lived Assets. SFAS
144 supercedes SFAS 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 Transactions.
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 were effective for financial
statements issued for fiscal years beginning after
December 15, 2001. The adoption of SFAS 144 also
requires that the gains and losses from the
disposition of certain income-producing real estate
assets and the related historical operating results
be reflected as discontinued operations in the
statements of operations for all periods presented.
Although net earnings is not affected, the Company
has reclassified results previously included in
continuing operations to discontinued operations
for qualifying dispositions under SFAS 144.

15 GOODWILL AND OTHER INTANGIBLE ASSETS

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

|                            |                    |        |                |              |             |   |           |         | 
|--------------------------- | ------------------ | ------ | -------------- | ------------ | ----------- | - | --------- | ------- | 
|                            |                    |        | April 30, 2003
|                            |                   
|                            |                    |        | Gross Carrying |              | Accumulated
|Amortized intangible assets |                    | Amount |                | Amortization
|                            |                    |        |                |             
|Proprietary customer        |                    |        |                |              |             |   |           |        
|                            | software solutions |        | $              | 960,419      |             |   | $         | 386,440 | 
|Computer software           |                    |        | 349,016        |              |             |   | 282,995   |        
|Real estate lease costs     |                    |        | 1,850,252      |              |             |   | 957,674   |        
|Deferred loan costs         |                    |        | 947,979        |              |             |   | 482,918   |        
|Other                       |                    |        | 28,660         |              |             |   | 5,733     |        
|                            |                    |        |                |              |             |   |           |         | 
|                            |                    | $      | 4,136,326      |              |             | $ | 2,115,760 |        
|                            |                    |        |                |              |             |   |           |         | 

|                            |                    |        |                |              |             |   |           |         | 
|--------------------------- | ------------------ | ------ | -------------- | ------------ | ----------- | - | --------- | ------- | 
|                            |                    |        | April 30, 2002
|                            |                   
|                            |                    |        | Gross Carrying |              | Accumulated
|Amortized intangible assets |                    | Amount |                | Amortization
|                            |                    |        |                |             
|Proprietary
customer        |                    |        |                |              |             |   |           |        
|                            | software
solutions |        | $              | 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 30,2003                                   |  | $ | 499,268 | 



|Estimated amortization expense for all amortized intangible
assets for the fiscal year ended April 30,
|------------------------------------------------------------------------------------------------------
|                                                                                                      

|     |  |   |         | 
|---- |  | - | ------- | 
|2004 |  | $ | 468,188 | 
|2005 |  |   | 431,135 | 
|2006 |  |   | 316,645 | 
|2007 |  |   | 184,853 | 
|2008 |  |   | 152,949 | 

The goodwill and trademark amounts are related to
the Energy Management Segment. For tax purposes,
all of the goodwill is expected to be amortized and
deductible.

16 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 were freestanding stores. The
Company sold at a gain its shopping center in
Englewood, Florida, which was co-anchored by a
Kmart store, on June 28, 2002. See Note 3 to the
consolidated financial statements. The remaining
three Kmart stores owned by the Company are
currently open and operating. The seven
freestanding Kmart stores that the Company
developed, sold, leased back, and then sub-leased
to Kmart are currently open and operating. The
leases for the three owned and seven leaseback
Kmart stores have been affirmed by Kmart under its
plan of reorganization. Kmart emerged from
bankruptcy in May 2003.

17 COMMITMENTS AND CONTINGENCIES

Effective April 30, 2003, the Company terminated an
employment agreement and entered into a new
retirement agreement with a former officer and
director of the Company. Beginning May 1, 2003,
the new agreement requires the Company to pay a
retirement benefit of approximately $87,000 through
August 19, 2003, and approximately $100,000 per
year thereafter for a term of four years ending on
August 19, 2007. In addition, the Company will
also continue to provide medical insurance benefits
through the term of the retirement agreement. The new agreement
accelerated the exercise date of the retirees
options, and provided that such options expire no
later than August 19, 2004. The retirement
agreement would terminate early, in the event of
the death of the retiree.

Assuming a discount rate of 5.25%, the Company has
accrued a net present value expense of $484,000
related to the retirement agreement, which is
included in selling, general and administrative
expenses in the accompanying statement of
operations for fiscal 2003. As of April 30, 2003,
$162,000 is included in accrued expenses and
$322,000 is included in other long term liabilities
in the accompanying balance sheet.

On July 7, 2003, the Company announced that an
internal investigation, which was conducted by the
Companys legal counsel at

n ABRAMS 2003 33





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the request of senior
management, had revealed information suggesting
that behavior in violation of Federal antitrust
laws may have taken place in a certain job bidding
process for one customer of the Companys
subsidiary, Abrams Construction, Inc., (ACI).

The results of this investigation were reported to
the Board of Directors of the Company on June 9,
2003. The Company has also voluntarily
communicated the results of its investigation to
the United States Department of Justice (DOJ) and
is fully cooperating in the subsequent inquiry that
has resulted from such communication. The DOJ, on
July 1, 2003, issued a conditional letter of
amnesty to the Company and its subsidiaries for
their cooperation in recognizing and then
immediately reporting the irregularities. The
Company believes, based on its internal
investigation, that the specific improprieties were
confined to a bidding process for The Home Depot,
Inc. (Home Depot), its largest customer. At this
time, the Company has no reason to believe that any
other customers were affected. The Company has
also communicated its concerns about the job
bidding process to Home Depot.

The Company estimates the costs associated with
this matter, including the Companys internal
investigation and its ongoing cooperation with the
DOJ, are expected to approximate $750,000 in the
current fiscal year ending April 30, 2004. Such
cost estimates, however, are particularly difficult
to make with any precision, and as a result the
actual costs may be lower or higher than this
amount. To date, no third party has made, or
threatened to make, any claim in connection with
this matter. It is possible, however, that claims
could be made as a result of this situation.

On December 18, 2002, ASK Financial, counsel for
Montgomery Ward, LLC (Ward), filed a complaint
in U.S. Bankruptcy Court in Delaware to recover
approximately $1.84 million in alleged preference
payments made by Ward to ACI, prior to Wards
Chapter 11 bankruptcy filing on December 28, 2000.
Under federal bankruptcy law, a bankrupt
debtor-in-possession can sue to recover
preferential payments made to the creditors of a
bankrupt debtor-in-possession during the 90-day
period preceding the filing for bankruptcy
protection, subject to certain defenses, including
payments made in the ordinary course of business.
Management cannot reasonably estimate the amount,
if any, that could ultimately be paid with respect
to this claim. The Company believes that it has meritorious defenses
to the action, and it intends to continue to vigorously defend
against the claim.

On September 20, 2002, the Companys subsidiary,
Abrams Properties, Inc. (API), filed a claim in
the Superior Court of Cobb County, Georgia, against
APIs former real estate asset manager. The
defendant subsequently made a demand against API
for arbitration and filed a counterclaim. During
the third quarter of fiscal 2003, the Cobb County
Superior Court denied the defendants demand for
arbitration, but in July 2003 this decision was
reversed by the Georgia Court of Appeals. The
Company intends to seek appellate review of this
most recent decision. The dispute arises out of
the defendants former provision of real estate
asset management services to API. The Company
believes APIs counter claims against its former
asset manager and its defenses to the managers
claims are meritorious and intends to continue to
vigorously pursue its claims and assert its
defenses.

Other than the costs of the Companys internal
investigation and ongoing cooperation associated
with the DOJ, the Company believes the ultimate
disposition of the above noted legal proceedings
and claims or potential claims will not have a
material adverse affect on the financial condition,
cash flows, or results of operations of the Company;
however, the Company cannot predict the ultimate
disposition of the above noted claims, potential
claims, and proceedings, and therefore, the Company
cannot be certain that the above noted legal
proceedings and claims or potential claims will not
have a material adverse affect on the financial
condition, cash flows, or results of operations of
the Company.

The Company is subject to other various legal
proceedings and claims that arise in the ordinary
course of business. While the resolution of these
matters cannot be predicted with certainty, the
Company believes that the final outcome of these
matters will not have a material adverse effect on
the Companys financial position or results of
operations.

n ABRAMS 2003 34





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18 QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Quarterly financial information for the fiscal years ended April 30, 2003, and
2002 (dollars in thousands, except per share amounts):

|                                                  |  |                                  |        |                |  |               |        |                |  |   |        |   |  |   |        |  
|------------------------------------------------- |  | -------------------------------- | ------ | -------------- |  | ------------- | ------ | -------------- |  | - | ------ | - |  | - | ------ | -
|                                                  |  | Fiscal
Year Ended April 30, 2003
|                                                  |  |                                 
|                                                  |  | First Quarter                    |        | Second Quarter |  | Third Quarter |        | Fourth Quarter
|                                                  |  |                                  |        |                |  |               |        |               
|Total revenues                                    |  | $                                | 17,722 |                |  | $             | 23,470 |                |  | $ | 15,825 |   |  | $ | 17,118 |  
|Gross profit                                      |  |                                  | 1,404  |                |  |               | 1,808  |                |  |   | 1,912  |   |  |   | 3,130  |  
|Net earnings (loss)                               |  |                                  | 164    |                |  |               | (543   | )              |  |   | (603   | ) |  |   | (92    | )
|Net earnings (loss) per share - basic and diluted |  |                                  | .06    |                |  |               | (.18   | )              |  |   | (.21   | ) |  |   | (.04   | )

|                                                  |  |                                  |        |                |  |               |        |                |  |   |        |   |  |   |        |  
|------------------------------------------------- |  | -------------------------------- | ------ | -------------- |  | ------------- | ------ | -------------- |  | - | ------ | - |  | - | ------ | -
|                                                  |  | Fiscal
Year Ended April 30, 2002
|                                                  |  |                                 
|                                                  |  | First Quarter                    |        | Second Quarter |  | Third Quarter |        | Fourth Quarter
|                                                  |  |                                  |        |                |  |               |        |               
|Total revenues                                    |  | $                                | 39,613 |                |  | $             | 32,568 |                |  | $ | 24,627 |   |  | $ | 18,820 |  
|Gross profit                                      |  |                                  | 2,778  |                |  |               | 2,420  |                |  |   | 1,989  |   |  |   | 1,821  |  
|Net earnings (loss)                               |  |                                  | 52     |                |  |               | 1,575  |                |  |   | (220   | ) |  |   | (595   | )
|Net earnings (loss) per share - basic and diluted |  |                                  | .02    |                |  |               | .54    |                |  |   | (.08   | ) |  |   | (.20   | )

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 |  |            |           |            |  |            |         |             |  |             |   |            |  |   |         |  |  |   |           | 
|Year ended April 30, 2003       |  | $          | 1,031,460 |            |  | $          | 84,727  |             |  | $           |  |            |  | $ | 624,142 |  |  | $ | 492,045   | 
|Year ended April 30, 2002       |  |            | 961,461   |            |  |            | 203,687 |             |  |             |  |            |  |   | 133,688 |  |  |   | 1,031,460 | 
|Year ended April 30, 2001       |  |            | 210,777   |            |  |            | 983,146 |             |  |             |  |            |  |   | 232,462 |  |  |   | 961,461   | 



|* |  | Allowance for doubtful accounts deductions resulted from the subsequent
write-off and/or recovery of the related receivable.
|- |  | ----------------------------------------------------------------------------------------------------------------------------

n ABRAMS 2003 35





---



##### Table of Contents



SCHEDULE IIIREAL
ESTATE AND ACCUMULATED DEPRECIATION, APRIL 30, 2003

|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           | 
|------------------------------------------------ |  | ------------ | ---------- | ---- |  | ----------------------- | ---------- | -------------- |  | ------------ | ---------- |  |  | ----------- | --------- | 
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  | Costs      
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  | Capitalized
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  | Subsequent 
|                                                 |  |              |            |      |  | Initial Cost to Company |            | to Acquisition
|                                                 |  |              |            |      |  |                         |            |               
|                                                 |  |              |            |      |  |                         |            |                |  | Building and |            |  |  |            
|Description                                      |  | Encumbrances |            | Land |  | Improvements            |            | Improvements  
|                                                 |  |              |            |      |  |                         |            |               
|INCOME-PRODUCING PROPERTIES:                     |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           | 
|Shopping Center - Jackson, MI                    |  | $            | 2,751,537  |      |  | $                       | 401,195    |                |  | $            | 1,788,183  |  |  | $           | 1,206,803 | 
|Kmart - Morton, IL                               |  |              | 2,521,592  |      |  |                         | 18,005     |                |  |              | 2,767,764  |  |  |             |          | 
|Kmart - Columbus, GA                             |  |              | 1,667,048  |      |  |                         | 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                    |  |              | 4,856,088  |      |  |                         | 660,000    |                |  |              | 4,338,102  |  |  |             | 770,063   | 
|Office Park - Marietta, GA                       |  |              | 6,138,567  |      |  |                         | 1,750,000  |                |  |              | 6,417,275  |  |  |             | 981,902   | 
|Shopping Center - Cincinnati, OH                 |  |              |           |      |  |                         | 1,699,410  |                |  |              | 617,102    |  |  |             | 395,469   | 
|Shopping
Center - North Ft. Myers, FL            |  |              | 11,351,353 |      |  |                         | 5,940,143  |                |  |              | 11,290,778 |  |  |             | 2,245,308 | 
|Shopping Center - Jacksonville, FL               |  |              | 8,600,058  |      |  |                         | 3,908,004  |                |  |              | 5,170,420  |  |  |             | 85,332    | 
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           | 
|                                                 |  |              | 37,886,243 |      |  |                         | 14,388,467 |                |  |              | 34,918,332 |  |  |             | 5,964,725 | 
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           | 
|REAL ESTATE HELD FOR FUTURE
DEVELOPMENT OR SALE: |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           | 
|Land - Louisville, KY                            |  |              |           |      |  |                         | 80,011     |                |  |              |           |  |  |             |          | 
|Land - Oakwood, GA                               |  |              |           |      |  |                         | 234,089    |                |  |              |           |  |  |             | 543,330   | 
|Land
- North Ft. Myers, FL                       |  |              |           |      |  |                         | 2,411,703  |                |  |              |           |  |  |             | 345,326   | 
|Land
and Building - Atlanta, GA (2)              |  |              |           |      |  |                         | 92,226     |                |  |              | 722,033    |  |  |             |          | 
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           | 
|                                                 |  |              |           |      |  |                         | 2,818,029  |                |  |              | 722,033    |  |  |             | 888,656   | 
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           | 
|                                                 |  | $            | 37,886,243 |      |  | $                       | 17,206,496 |                |  | $            | 35,640,365 |  |  | $           | 6,853,381 | 
|                                                 |  |              |            |      |  |                         |            |                |  |              |            |  |  |             |           | 

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

|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |           | 
|---------------------------- | ----------------------------------------------------------- | - | ----------- | ------- | ------------------------ | - | ---------- | ------- | ---- | - | ---------- | ------- | ---- | - | ---------- | --------- |  | - | ---------- | --------- | --- | - | ---------- | --------- | 
|                             |                                                             |   | Real Estate |         | Accumulated Depreciation
|                             |                                                             |   |             |         |                         
|                             |                                                             |   | 2003        |         | 2002                     |   | 2001       |         | 2003 |   | 2002       |         | 2001
|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |         |     
|BALANCE AT
BEGINNING OF YEAR |                                                             | $ | 64,541,303  |         |                          | $ | 63,894,081 |         |      | $ | 63,455,753 |         |      | $ | 15,784,645 |           |  | $ | 13,570,955 |           |     | $ | 12,125,222 |          
|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |          
|ADDITIONS DURING YEAR        |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |          
|                             | Real Estate                                                 |   |             | 260,929 |                          |   |            | 602,062 |      |   |            | 438,328 |      |   |            |          |  |   |            |          |     |   |            |          | 
|                             | Depreciation                                                |   |             |         |                          |   |            |        |      |   |            |        |      |   |            | 1,619,116 |  |   |            | 1,808,125 |     |   |            | 1,445,733 | 
|                             | Transfers                                                   |   |             |        |                          |   |            | 814,259 | (2)  |   |            |        |      |   |            |          |  |   |            | 492,548   | (2) |   |            |          | 
|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |          
|                             |                                                             |   | 260,929     |         |                          |   | 1,416,321  |         |      |   | 438,328    |         |      |   | 1,619,116  |           |  |   | 2,300,673  |           |     |   | 1,445,733  |          
|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |          
|DEDUCTIONS DURING YEAR       |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |          
|                             | Accumulated depreciation on
properties sold or transferred  |   |             |        |                          |   |            |        |      |   |            |        |      |   |            | 19,099    |  |   |            | 86,983    |     |   |            |          | 
|                             | Carrying value of real estate
sold, transferred, or retired |   |             | 285,721 |                          |   |            | 769,099 |      |   |            |        |      |   |            |          |  |   |            |          |     |   |            |          | 
|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |          
|                             |                                                             |   | 285,721     |         |                          |   | 769,099    |         |      |   |           |         |      |   | 19,099     |           |  |   | 86,983     |           |     |   |           |          
|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |          
|BALANCE AT CLOSE OF YEAR     |                                                             | $ | 64,516,511  |         |                          | $ | 64,541,303 |         |      | $ | 63,894,081 |         |      | $ | 17,384,662 |           |  | $ | 15,784,645 |           |     | $ | 13,570,955 |          
|                             |                                                             |   |             |         |                          |   |            |         |      |   |            |         |      |   |            |           |  |   |            |           |     |   |            |          

n ABRAMS
2003 36





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|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |          | 
|------------------------ | ---------- | ------------ | ------------ | ---------- | ----------- | --------- | --------- | ------------ |  | ------------ | --------------- | ---------- | ---------- | ------------ | ---------- | ---------- | --------- |  | ---------- | ---------- |  |  | ---------- | - |  |  | ------------- | -------- | 
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  | 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
|Land                     |            | Improvements |              | Interest   |             | Total (1) |           | Depreciation |  | Construction |                 | Acquired   |            | is Computed 
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |             
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |         
|$                        | 453,293    |              | $            | 2,942,888  |             |           | $         | 89,866       |  |              | $               | 3,486,047  |            |              | $          | 2,146,831  |           |  |            | 1972, 1996 |  |  |            |  |  |  |               | 39 years | 
|18,005                   |            |              | 2,767,764    |            |             |           |          |              |  |              | 2,785,769       |            |            |              | 2,546,411  |            |           |  | 1980, 1992 |            |  |  |           |   |  |  | 25 years      |         
|11,710                   |            |              | 2,366,998    |            |             |           | 238,970   |              |  |              | 2,617,678       |            |            |              | 2,350,061  |            |           |  | 1980, 1988 |            |  |  |           |   |  |  | 25 years      |         
|                        |            |              | 195,411      |            |             |           |          |              |  |              | 195,411         |            |            |              | 184,738    |            |           |  | 1995       |            |  |  |           |   |  |  | 7 years       |         
|                        |            |              | 42,151       |            |             |           |          |              |  |              | 42,151          |            |            |              | 17,703     |            |           |  | 1994       |            |  |  |           |   |  |  | 25 years      |         
|                        |            |              | 163,218      |            |             |           |          |              |  |              | 163,218         |            |            |              | 163,218    |            |           |  | 1995       |            |  |  |           |   |  |  | 7 years       |         
|                        |            |              | 40,778       |            |             |           |          |              |  |              | 40,778          |            |            |              | 11,973     |            |           |  | 1997       |            |  |  |           |   |  |  | 15 years      |         
|660,000                  |            |              | 5,108,165    |            |             |           |          |              |  |              | 5,768,165       |            |            |              | 1,088,953  |            |           |  | 1974, 1997 | (3)        |  |  | 1997       |   |  |  | 39 years      |         
|1,750,000                |            |              | 7,399,177    |            |             |           |          |              |  |              | 9,149,177       |            |            |              | 1,294,864  |            |           |  | 1980, 1985 | (4)        |  |  | 1997       |   |  |  | 39 years      |         
|1,699,410                |            |              | 1,012,571    |            |             |           |          |              |  |              | 2,711,981       |            |            |              | 151,485    |            |           |  | 1982       | (4)        |  |  | 1998       |   |  |  | 39 years      |         
|5,276,631                |            |              | 14,199,598   |            |             |           | 4,470,789 |              |  |              | 23,947,018      |            |            |              | 6,409,692  |            |           |  | 1993, 1996 |            |  |  |           |   |  |  | 31.5 years    |         
|3,908,004                |            |              | 5,255,752    |            |             |           |          |              |  |              | 9,163,756       |            |            |              | 526,183    |            |           |  | 1985       | (4)        |  |  | 1999       |   |  |  | 39 years      |         
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |         
|13,777,053               |            |              | 41,494,471   |            |             |           | 4,799,625 |              |  |              | 60,071,149      |            |            |              | 16,892,112 |            |           |  |            |            |  |  |            |   |  |  |               |         
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |         
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |         
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |         
|80,011                   |            |              |             |            |             |           |          |              |  |              | 80,011          |            |            |              |           |            |           |  |           |            |  |  | 1979       |   |  |  |              |         
|777,419                  |            |              |             |            |             |           | 16,644    |              |  |              | 794,063         |            |            |              |           |            |           |  |           |            |  |  | 1987       |   |  |  |              |         
|2,757,029                |            |              |             |            |             |           |          |              |  |              | 2,757,029       |            |            |              |           |            |           |  |           |            |  |  | 1993       |   |  |  |              |         
|92,226                   |            |              | 722,033      |            |             |           |          |              |  |              | 814,259         |            |            |              | 492,550    |            |           |  | 1970-1980  |            |  |  | 1960, 1968 |   |  |  |              |         
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |         
|3,706,685                |            |              | 722,033      |            |             |           | 16,644    |              |  |              | 4,445,362       |            |            |              | 492,550    |            |           |  |            |            |  |  |            |   |  |  |               |         
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |         
|$                        | 17,483,738 |              | $            | 42,216,504 |             |           | $         | 4,816,269    |  |              | $               | 64,516,511 |            |              | $          | 17,384,662 |           |  |            |            |  |  |            |   |  |  |               |          | 
|                         |            |              |              |            |             |           |           |              |  |              |                 |            |            |              |            |            |           |  |            |            |  |  |            |   |  |  |               |         

NOTES:



|(1) |  | The aggregated cost for land and building and improvements for federal
income tax purposes at April 30, 2003, is $51,681,138.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Vacant; former manufacturing facility.                                                                                       
|   
|(3) |  | Developed by others in 1974; redeveloped by the Company in 1997.                                                             
|   
|(4) |  | Developed by others.                                                                                                         






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


The information required by this Item has been previously reported on Current
Reports on Form 8-K filed October 30, 2001, and May 28, 2002.

n ABRAMS 2003 37





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##### 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, Compensation of Executive Officers and
Directors, and Equity Compensation Plan in the Companys
definitive proxy materials for its 2003 Annual Meeting of Shareholders, will be
filed with the Securities and Exchange Commission under a
separate filing, and are 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 CONTROLS AND PROCEDURES

The Company has evaluated its disclosure controls and procedures as
defined by Rules 13a-14 and 15d-14 under the Securities
Exchange Act of 1934, as amended, within 90 days of the filing date of this
Annual Report. This evaluation was carried out under
the supervision and with the participation of the Companys management,
including its Chief Executive Officer and Chief Financial
Officer. Based on this evaluation, these officers have concluded that the
Companys disclosure controls and procedures were effective
as of the date of the evaluation. There were no significant changes to the
Companys internal controls or in other factors that could
significantly affect internal controls subsequent to the date of the last
evaluation of internal controls.




PART IV




ITEM 16 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 Auditors Report and Report of Independent Accountants
Consolidated Balance Sheets at April 30, 2003, and 2002
Consolidated Statement of Operations for the Years Ended April 30, 2003,
2002, and 2001
Consolidated Statements of Shareholders Equity for the Years Ended April
30, 2003, 2002, and 2001
Consolidated Statements of Cash Flows for the Years Ended April 30, 2003,
2002, and 2001
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)#  
| |  | 10h. | Edward M. Abrams Retirement Agreement dated July 22, 2003#                      
| |  | 21.  | List of the Companys Subsidiaries                                              
| |  | 23a. | Consent of Deloitte & Touche LLP                                                
| |  | 23b. | Consent of PricewaterhouseCoopers LLP                                           
| |  | 99.1 | Section 906 Certification of the CEO                                            
| |  | 99.2 | Section 906 Certification of the CFO                                            



| |  | Explanation of Exhibits
| |  | -----------------------

| | (1) |  | This exhibit is 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) |  | This exhibit is incorporated by reference to the Companys Form 10-K for
the year ended April 30, 1993.

n ABRAMS 2003 38



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##### Table of Contents





| | (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) |  | These exhibits are 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 2003.                                                                                      
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(C) |  | The Company hereby files as exhibits to this Annual Report on Form 10-K
the exhibits set forth in Item 16(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 16(A)2 hereof.




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 25, 2003 |  | 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 25, 2003 |  | /s/ Alan R. Abrams                    
|                     |  |                                       
|                     |  | Alan R. Abrams                        
|                     |  | Co-Chairman of the Board of Directors,
|                     |  | Chief Executive Officer               
|                     |  |                                       
|Dated: July 25, 2003 |  | /s/ J. Andrew Abrams                  
|                     |  |                                       
|                     |  | J. Andrew Abrams                      
|                     |  | Co-Chairman of the Board of Directors 
|                     |  |                                       
|Dated: July 25, 2003 |  | /s/ David L. Abrams                   
|                     |  |                                       
|                     |  | David L. Abrams                       
|                     |  | Director                              
|                     |  |                                       
|Dated: July 25, 2003 |  | /s/ Paula Lawton Bevington            
|                     |  |                                       
|                     |  | Paula Lawton Bevington                
|                     |  | Director                              
|                     |  |                                       
|Dated: July 25, 2003 |  | /s/ Gilbert L. Danielson              
|                     |  |                                       
|                     |  | Gilbert L. Danielson                  
|                     |  | Director                              
|                     |  |                                       
|Dated: July 25, 2003 |  | /s/ Melinda S. Garrett                
|                     |  |                                       
|                     |  | Melinda S. Garrett                    
|                     |  | Director, Chief Financial Officer, and
|                     |  | Chief Accounting Officer              
|                     |  |                                       
|Dated: July 25, 2003 |  | /s/ Robert T. McWhinney, Jr.          
|                     |  |                                       
|                     |  | Robert T. McWhinney, Jr.              
|                     |  | Director                              
|                     |  |                                       
|Dated: July 25, 2003 |  | /s/ Felker W. Ward, Jr.               
|                     |  |                                       
|                     |  | Felker W. Ward, Jr.                   
|                     |  | Director                              

n
ABRAMS 2003 39



---



##### Table of Contents






CERTIFICATION BY CHIEF EXECUTIVE OFFICER

I, Alan R. Abrams, certify that:



| | 1. |  | I have reviewed this annual report on Form 10-K of Abrams Industries,
Inc.;                                                                                                                                                                                                                                             
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 2. |  | Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
annual report;
|
| | 3. |  | Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;                   
|
| | 4. |  | The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange
Act Rules 13a-14 and 15d-14) for the registrant and we have:                                                                                                



| | a. |  | Designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries,
is made known to us by others within those entities, particularly during
the period in which this annual report is being prepared;
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b. |  | Evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the Evaluation Date); and                                                                                                  
|
| | c. |  | Presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;                                                                                                                        



| | 5. |  | The registrants other certifying officer and I have disclosed, based
on our most recent evaluation, to the registrants auditors and the audit
committee of
the registrants board of directors (or persons performing the equivalent
function):
| | -- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a. |  | All significant deficiencies in the design or operation of internal
controls which could adversely affect the registrants ability to record,
process,
summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b. |  | Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal controls;
and                                                                                                                                        



| | 6. |  | The registrants other certifying officer and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in
other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions
with
regard to significant deficiencies and material weaknesses.
| | -- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                     |  |                        
|-------------------- |  | -----------------------
|Dated: July 25, 2003 |  | /s/ Alan R. Abrams     
|                     |  |                        
|                     |  | Alan R. Abrams         
|                     |  | Chief Executive Officer




CERTIFICATION BY CHIEF FINANCIAL OFFICER

I, Melinda S. Garrett, certify that:



| | 1. |  | I have reviewed this annual report on Form 10-K of Abrams Industries,
Inc.;                                                                                                                                                                                                                                             
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 2. |  | Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
annual report;
|
| | 3. |  | Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;                   
|
| | 4. |  | The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange
Act Rules 13a-14 and 15d-14) for the registrant and we have:                                                                                                



| | a. |  | Designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries,
is made known to us by others within those entities, particularly during
the period in which this annual report is being prepared;
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b. |  | Evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the Evaluation Date); and                                                                                                  
|
| | c. |  | Presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;                                                                                                                        



| | 5. |  | The registrants other certifying officer and I have disclosed, based
on our most recent evaluation, to the registrants auditors and the audit
committee of
the registrants board of directors (or persons performing the equivalent
function):
| | -- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a. |  | All significant deficiencies in the design or operation of internal
controls which could adversely affect the registrants ability to record,
process,
summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b. |  | Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal controls;
and                                                                                                                                        



|6. |  | The registrants other certifying officer and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in
other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions
with
regard to significant deficiencies and material weaknesses.
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                     |  |                        
|-------------------- |  | -----------------------
|Dated: July 25, 2003 |  | /s/ Melinda S. Garrett 
|                     |  |                        
|                     |  | Melinda S. Garrett     
|                     |  | Chief Financial Officer

n ABRAMS
2003 40