ALICO INC (ALCO) SEC Filing 10-K Annual report for the fiscal year ending Sunday, September 30, 2018

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                     Exhibit 99.1    
alicographica12.jpg

                
For immediate release:

Alico, Inc. Announces Financial Results for Fiscal Year 2018 Along With Update on Alico 2.0 Modernization Program
 

Fort Myers, FL, December 6, 2018 - Alico, Inc. (“Alico” or the “Company”) (Nasdaq "ALCO") today announces financial results for the fourth quarter and fiscal year ended September 30, 2018 and an update on the Alico 2.0 Modernization Program.

For the fiscal year ended September 30, 2018, the Company recorded net income attributable to Alico common shareholders of $13.1 million and earnings of $1.57 per diluted common share, compared to a net loss attributable to Alico common shareholders of $9.5 million and a loss of $1.14 per diluted common share in the prior fiscal year. Net income attributable to Alico common shareholders for the fiscal year ended September 30, 2018 benefited from higher gains from sales of real estate, property and equipment and assets held for sale, insurance proceeds received relating to Hurricane Irma damage, lower operating expenses and a one-time deferred tax benefit of approximately $9.8 million due to the federal corporate tax rate reduction enacted on December 22, 2017. These benefits were offset by lower citrus production due to the impact of Hurricane Irma and a valuation allowance of approximately $5.6 million associated with the expiration of a capital loss carryforward.
 
When both periods are adjusted for non-recurring items related to transaction costs, separation and consulting arrangements, gains on sale of real estate, property and equipment, assets held for sale, employee stock compensation expense, impairment of inventory and long-lived assets, insurance proceeds received relating to Hurricane Irma, and net deferred tax adjustments, the Company had an adjusted net loss attributable to Alico common shareholders of $1.6 million and adjusted earnings of $(0.19) per diluted common share for the fiscal year ended September 30, 2018, compared to adjusted net income attributable to Alico common shareholders of $2.0 million and adjusted earnings of $0.24 per diluted common share for the fiscal year ended September 30, 2017. Adjusted EBITDA for the fiscal years ended September 30, 2018 and 2017 was $21.2 million and $35.7 million, respectively. Adjusted free cash flow for the fiscal years ended September 30, 2018 and 2017 was $(3.5) million and $16.8 million, respectively.

The Company reported the following financial results: (1)

(in thousands except for per share amounts)
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30,
 
Fiscal Year Ended September 30,
 
2018
 
2017
 
Change
 
2018
 
2017
 
Change
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Alico, Inc. common stockholders
$
718

 
$
(19,028
)
 
$
19,746

 
$
13,050

 
$
(9,451
)
 
$
22,501

EBITDA
$
5,742

 
$
(23,673
)
 
$
29,415

 
$
35,757

 
$
11,070

 
$
24,687

Earnings (loss) per diluted common share
$
0.09

 
$
(2.29
)
 
$
2.38

 
$
1.57

 
$
(1.14
)
 
$
2.71

Net cash provided by (used in) operating activities
$
2,936

 
$
(671
)
 
$
3,607

 
$
19,055

 
$
28,229

 
$
(9,174
)

(1)
See “Non-GAAP Financial Measures” at the end of this earnings release for details regarding certain of these measures.


1

The following information was filed by ALICO INC on Thursday, December 6, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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  • 18489025_192
    Revenue - Product
    Net Cash Provided By (Used In) Investing Activities The following table details the items contributing to Net Cash Provided By (Used In) Investing Activities for the fiscal years ended September 30, 2018, 2017 and 2016: The increase in net cash provided by (used in) investing activities for the fiscal year ended September 30, 2018, as compared to the fiscal year ended September 30, 2017, was primarily due to proceeds received from the sale of certain assets during the fiscal year 2018.
  • 18489025_186
    Revenue - Product
    The following table details the items contributing to the changes in cash and cash equivalents and restricted cash for fiscal years ended September 30, 2018, 2017 and 2016: Net Cash Provided By Operating Activities The following table details the items contributing to Net Cash Provided by Operating Activities for the fiscal years ended September 30, 2018, 2017 and 2016: The decrease in net cash provided by operating activities for the fiscal year ended September 30, 2018, as compared to the same period in the fiscal year 2017, was primarily due to the effect of the Company recognizing a greater gain on the sale of real estate, property and equipment and assets held for sale as a result of the Company?s decision to divest itself from several non-core and underperforming assets during the fiscal year 2018.
  • 18489025_48
    Financial - Shares / Equity
    Included in the 752,234 shares were 163,999 shares that the Company elected to purchase pursuant to its right to purchase up to an additional 2% of its outstanding shares of common stock.
  • 18489025_143
    Financial - Expense
    The slight increase in general and administrative expenses in fiscal year 2018, as compared to the same period in fiscal year 2017, primarily relates to increases in bonus awards provided to senior executives and managers, an acceleration of stock compensation expense as a result of two senior executives forfeiting a portion of their stock options, costs related to the Tender Offer which commenced in September 2018 and an increase in rent, which commenced October 30, 2017, as a result of the Company selling its office building in Fort Myers, FL, and leasing back a portion of the space.
  • 18489025_248
    Financial - Income
    Any increase or decrease in a valuation allowance could have a material adverse or beneficial impact on the Company?s income tax provision and net income or loss in the period the determination is made.
  • 18489025_146
    Financial - Expense
    The increase in general and administrative expenses in fiscal year 2017, as compared to fiscal year ended 2016, primarily relates to salary and stock compensation expenses incurred with respect to employment agreements executed for new executives during the year.
  • 18489025_160
    Financial - Income
    For the fiscal years ended September 30, 2018, 2017 and 2016, the provision (benefit) for income taxes was approximately $390,000, $(3,846,000), and $5,521,000, respectively, and the related effective income tax rates were approximately 2.96%, 28.83% and 44.20%, respectively.
  • 18489025_183
    Other - Other
    Cash and cash equivalents and restricted cash increased approximately $28,865,000 as of September 30, 2018, as compared to September 30, 2017.
  • 18489025_129
    Financial - Earnings
    The decrease in gross profit for fiscal year 2017, as compared to fiscal year 2016, relates primarily to certain impairments which were recorded on assets associated with the Ranch.
  • 18489025_226
    Revenue - Product
    Supply chain management service revenues are recognized when the services are performed.
  • 18489025_110
    Financial - Expense
    The decrease in operating costs is due to (i) the Company allocating a smaller amount of its accumulated costs to its cost of goods sold, (ii) less harvesting cost incurred due to fewer boxes being harvested, and (iii) the Company receiving approximately $9,429,000 of insurance proceeds.
  • 18489025_196
    Other - Other
    Net Cash Used In Financing Activities The following table details the items contributing to Net Cash Used In Financing Activities for the fiscal years ended September 30, 2018, 2017 and 2016: The decrease in net cash used in financing activities for the fiscal year ended September 30, 2018, as compared to the fiscal year ended September 30, 2017, was primarily due to decreased repayments on the revolving line of credit, which was partially offset by less borrowings being made on the revolving lines of credit.
  • 18489025_128
    Revenue - Product
    The decrease in revenues from the sale of calves and culls in fiscal year 2017, as compared to fiscal year 2016, is primarily due to a decrease in price per pound.
  • 18489025_279
    Management Change - Other
    Appointment of Interim President In connection with the commencement of the termination proceedings against Mr. Trafelet, Benjamin D. Fishman, a current member of the Board of Directors, was appointed to serve as Interim President of the Company, effective as of November 19, 2018.
  • 18489025_45
    Financial - Shares / Equity
    Tender Offer On September 5, 2018 the Board of Directors approved and Alico announced the commencement of an issuer tender offer (the "Tender Offer") to purchase up to $19,999,990 in value of shares of its common stock at a purchase price of $34.00 per share.
  • 18489025_89
    Revenue - Product
    In addition, the decrease in revenue, to a smaller extent, was due to fewer boxes of fresh fruit being sold for the fiscal year ended September 30, 2018.
  • 18489025_144
    Financial - Expense
    These items resulted in an aggregate increase in general and administrative expenses of approximately $2,700,000.
  • 18489025_83
    Financial - Expense
    Harvesting and hauling costs represent the costs of bringing citrus product to processors and varies based upon the number of boxes produced.
  • 18489025_169
    Financial - Cash Flow
    Alico's business has historically generated positive net cash flows from operating activities.
  • 18489025_75
    Revenue - Product
    The following discussion provides an analysis of Alico's results of operations and should be read in conjunction with the accompanying Consolidated Statements of Operations for the years ended September 30, 2018, 2017 and 2016: NM - Not Meaningful The following table presents our operating revenues, by segment, as a percentage of total operating revenues for the fiscal years ended September 30, 2018, 2017 and 2016: The following discussion provides an analysis of the Company's operating segments: The table below presents key operating measures for the fiscal years ended September 30, 2018, 2017 and 2016: Our citrus groves produce the majority of our annual operating revenues and the citrus grove business is seasonal because it is tied to the growing and harvest season.
  • 18489025_194
    Revenue - Product
    The decrease in net cash used in investing activities for the fiscal year ended September 30, 2017, as compared to the fiscal year ended September 30, 2016, was primarily due to proceeds from the sale of land and facilities located in Hendry County, Florida of approximately $2,200,000.
  • 18489025_65
    Revenue - Geography
    We have also deployed a more efficient labor model that is consistent and uniform for field staffing and grove operating programs and aligns with the geographical footprint of the citrus groves.
  • 18489025_119
    Revenue - Geography
    The Company will also deploy a more efficient labor model that is consistent and uniform for field staffing and grove operating programs, and aligns with the geographical footprint of the citrus groves.
  • 18489025_190
    Financial - Earnings
    The decrease in net cash provided by operating activities for the fiscal year ended September 30, 2017 compared to the fiscal year ended September 30, 2016 was primarily due to a decrease in net income and deferred tax expense and was substantially offset by the Company recording an inventory casualty loss, which was the direct result of Hurricane Irma, and other impairments recorded on certain assets held for sale and other fixed assets (see Note 3.
  • 18489025_156
    Financial - Expense
    Additionally, the Company incurred less interest expense of approximately $580,000 due to the continued pay-down of its long-term debt, as well as a prepayment made on a loan of approximately $4,453,000 with the proceeds from the asset sales.
  • 18489025_107
    Other - Other
    The improvement from these estimates is the result of the Valencia variety fruit experiencing less fruit drop then was anticipated upon making the estimate in production.
  • 18489025_25
    Other - Other
    The environmental services dispersed water management project ("Water Project") encompasses a large-scale water storage/nutrient load reduction project over approximately half of the Company's 72,000-acre ranch located in southern Hendry County.
  • 18489025_113
    Financial - Earnings
    The decrease in gross profit for fiscal year 2017, as compared to fiscal year 2016, related primarily to decreased revenues of approximately $13,841,000 discussed above, and the recording of an inventory casualty loss of approximately $13,489,000 relating to fruit loss as a result of Hurricane Irma.
  • 18489025_47
    Financial - Shares / Equity
    These shares represented approximately 9.2% of the total number of shares of the Company?s common stock issued and outstanding as of October 2, 2018.
  • 18489025_256
    Financial - Cash Flow
    The Company records impairment losses on long-lived assets used in operations, other than goodwill, when events and circumstances indicate that the asset or asset group might be impaired and the estimated cash flows (undiscounted and without interest charges) to be generated by those assets or asset group over the remaining lives of the assets are less than the carrying amounts of those assets.
  • 18489025_11
    Other - Other
    We are a Florida agribusiness and land management company with a legacy of achievement and innovation in citrus, cattle and resource conservation.
  • 18489025_99
    Other - Other
    The decline in boxes harvested and pound solids produced for fiscal year 2017, as compared to fiscal year 2016, is believed to be mainly driven by growing season fluctuations in production which may have been attributable to various factors, including extreme weather patterns such as a drought and higher than normal temperatures during the Early and Mid-season harvest impacting all varieties.
  • 18489025_16
    MA - Other
    Alico opportunistically acquires new agricultural assets and produces high quality agricultural products while exercising responsible environmental stewardship.
  • 18489025_85
    Revenue - Product
    The decrease in revenues for the fiscal year ended September 30, 2018, compared to the fiscal year ended September 30, 2017, was primarily due to the impact of Hurricane Irma.
  • 18489025_233
    Financial - Expense
    Major improvements are capitalized while maintenance and repairs are expensed in the period the cost is incurred.
  • 18489025_62
    Financial - Expense
    This initiative explored every aspect of Alico?s citrus and ranch operations, including corporate and operational cost structures, grove costs, purchasing and procurement, non-performing and under-performing assets, professional fees, and human resources efficiency.
  • 18489025_115
    Financial - Expense
    This initiative explored every aspect of Alico?s citrus and ranch operations, including corporate and operational cost structures, grove costs, purchasing and procurement, non-performing and under-performing assets, professional fees, and human resources efficiency.
  • 18489025_155
    Other - Other
    During the fiscal year ended September 30, 2017, the Company sold land and facilities in Hendry County, Florida, which resulted in a gain of approximately $1,371,000.

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  • Form Type: Annual
  • Number of times amended: 0
  • Accession Number: 0000003545-18-000108
  • Submitted to the SEC: Thursday, December 6, 2018 4:58:38 PM EST
  • Accepted by the SEC: Thursday, December 6, 2018
  • Fiscal Year ending: September 2018
  • Industry: Agricultural Production Crops