Alico(ALCO) - 2025 Q3 - Quarterly Results

Executive Summary & Company Overview Management Comments Alico, Inc. successfully completed its final major citrus harvest, marking a significant step in its strategic transformation to a diversified land company - Completed final major citrus harvest, signifying a key milestone in the strategic transformation to a diversified land company[3] - Generated over $9 million from combined land and equipment sales during the third quarter[3] - Received $16 million in crop insurance proceeds, enhancing financial flexibility for transformation initiatives[3] - Florida Legislature approved the bill to create the Corkscrew Grove Stewardship District, a crucial step for the Corkscrew Grove Villages development project[3] Financial Performance Highlights Key Financial Metrics (Summary) Alico reported a significant increase in net loss and loss per diluted share for Q3 and YTD 2025, primarily due to accelerated depreciation and lower revenues, while net cash provided by operating activities and EBITDA improved significantly in Q3 2025 Key Financial Metrics (in thousands, except per share amounts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | % Change | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | % Change | | :----------------------------------- | :------------------------------- | :------------------------------- | :------- | :------------------------------ | :------------------------------ | :------- | | Revenue | $8,390 | $13,610 | (38.4)% | $43,264 | $45,708 | (5.3)% | | Net (loss) income attributable to Alico, Inc. common stockholders | $(18,289) | $(2,044) | (794.8)% | $(138,841) | $25,097 | NM | | (Loss) earnings per diluted common share | $(2.39) | $(0.27) | (785.2)% | $(18.18) | $3.29 | NM | | EBITDA | $19,204 | $1,343 | NM | $(2,210) | $48,686 | (104.5)% | | Adjusted EBITDA | $19,273 | $1,343 | NM | $25,330 | $48,686 | (48.0)% | | Net cash provided by (used in) operating activities | $23,412 | $1,021 | NM | $22,841 | $(18,720) | 222.0 % | Net Loss Analysis The net loss attributable to Alico common stockholders significantly increased in Q3 2025, primarily driven by approximately $40.7 million in accelerated depreciation and lower revenues, partially offset by crop insurance proceeds and a tax benefit - Net loss attributable to Alico common stockholders increased to $(18.3) million in Q3 2025 from $(2.0) million in Q3 2024, a 794.8% increase[4] - Loss per basic and diluted common share was $(2.39) in Q3 2025, compared to $(0.27) in Q3 2024[4] - The increase in net loss was primarily due to $40.7 million of accelerated depreciation on citrus trees (due to strategic transformation) and lower revenues from Hurricane Milton, partially offset by $16.0 million in crop insurance proceeds and a $7.8 million tax benefit[4] EBITDA and Adjusted EBITDA For Q3 2025, Alico reported a substantial increase in both EBITDA and Adjusted EBITDA compared to the prior year, reaching $19.2 million and $19.3 million respectively, though year-to-date figures decreased EBITDA and Adjusted EBITDA (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------- | :------------------------------- | :------------------------------- | | EBITDA | $19,204 | $1,343 | | Adjusted EBITDA | $19,273 | $1,343 | | Metric | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :------------- | :------------------------------ | :------------------------------ | | EBITDA | $(2,210) | $48,686 | | Adjusted EBITDA | $25,330 | $48,686 | Seasonal Business Impact Alico's business is seasonal, with most citrus harvest and gross profit historically recognized in Q2 and Q3, but these patterns are expected to diminish as citrus operations wind down - The majority of the Company's citrus crop is typically harvested in the second and third quarters of the fiscal year, historically recognizing most gross profit and cash flows from operating activities in those quarters[6] - Due to previous year harvest timing, more citrus crop was harvested in Q1 and Q2 of the prior fiscal year, shifting working capital requirements to Q3 and Q4[6] - Seasonal patterns are expected to diminish as the Company winds down citrus operations and will not allocate additional material capital to them, as part of the Strategic Transformation[6] Segment Results Alico Citrus Alico Citrus experienced a significant decrease in pound solids harvested for both Q3 and YTD 2025 due to Hurricane Milton, despite an increase in blended price per pound solids Citrus Production Summary (in thousands, except per box and per pound solids data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (Unit) | Change (%) | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | Change (Unit) | Change (%) | | :------------------------ | :------------------------------- | :------------------------------- | :------------ | :--------- | :------------------------------ | :------------------------------ | :------------ | :--------- | | Boxes Harvested: | | | | | | | | | | Valencias | 420 | 843 | (423) | (50.2)% | 1,305 | 1,855 | (550) | (29.6)% | | Total Processed | 420 | 843 | (423) | (50.2)% | 2,249 | 3,049 | (800) | (26.2)% | | Total | 420 | 843 | (423) | (50.2)% | 2,286 | 3,084 | (798) | (25.9)% | | Pound Solids Produced: | | | | | | | | | | Valencias | 2,134 | 4,294 | (2,160) | (50.3)% | 6,622 | 9,365 | (2,743) | (29.3)% | | Total | 2,134 | 4,294 | (2,160) | (50.3)% | 10,846 | 14,729 | (3,883) | (26.4)% | | Price per Pound Solids: | | | | | | | | | | Valencias | $3.65 | $2.84 | $0.81 | 28.5 % | $3.64 | $2.87 | $0.77 | 26.8 % | - The decrease in pound solids harvested was primarily due to fruit drop caused by Hurricane Milton in October 2024[8] - Blended price per pound solids increased by $0.81 (Q3) and $0.85 (YTD) compared to the prior year, driven by more favorable pricing in a Tropicana contract[9] Land Management and Other Operations Revenue for Land Management and Other Operations increased significantly in Q3 and YTD 2025 due to higher rock and sand royalty income and sod sales, partially offset by reduced lease revenues - Land Management and Other Operations revenue increased 56.8% (Q3) and 68.3% (YTD) compared to the prior year, primarily due to increased rock and sand royalty income and sod sales[11] - The increase in revenue was partially offset by lower farm, grazing, and hunting lease revenues due to the sale of the Alico Ranch[11] - Operating expenses for Land Management and Other Operations increased 69.0% in Q3 2025 due to an increase in Sod sales, but decreased 32.7% for the nine months ended June 30, 2025, primarily due to lower property and real estate taxes from the Alico Ranch sale[12] Other Corporate Financial Information General and Administrative Expenses General and administrative expenses increased in both Q3 and YTD 2025, primarily due to accelerated depreciation on administrative assets and higher legal fees related to the Strategic Transformation - General and administrative expense increased $0.4 million for Q3 2025, mainly due to accelerated depreciation on administrative assets, higher employee costs (bonus accruals), and increased legal fees related to the Strategic Transformation[13] - General and administrative expense increased $0.8 million for the nine months ended June 30, 2025, due to accelerated depreciation on administrative assets and increased legal fees related to the Strategic Transformation, partially offset by lower employee costs[14] Other Income (Expense), Net Other income (expense), net, increased in Q3 2025 due to asset sales, but significantly decreased YTD 2025 primarily due to fewer land sales compared to the prior year - Other income (expense), net, increased $0.8 million for Q3 2025, driven by the sale of approximately 694 acres of land and a $1.3 million gain from equipment and vehicle sales[15] - Other income (expense), net, decreased $60.0 million for the nine months ended June 30, 2025, principally due to fewer acres of land being sold compared to the prior year, which included the sale of the Alico Ranch[16] Dividend Information Alico, Inc. paid a third-quarter cash dividend of $0.05 per share on its outstanding common stock on July 11, 2025 - The Company paid a third quarter cash dividend of $0.05 per share on its outstanding common stock on July 11, 2025[17] Balance Sheet and Liquidity & Real Estate Development Key Balance Sheet Metrics Alico demonstrated strong financial strength with working capital of $50.0 million and a current ratio of 9.37 to 1.00 at June 30, 2025, alongside significant reductions in total and net debt - Working capital was $50.0 million at June 30, 2025, representing a 9.37 to 1.00 current ratio[20] - Total debt was $85.2 million at June 30, 2025, down from $92.1 million at September 30, 2024[20] - Net debt was $43.2 million at June 30, 2025, a significant reduction from $89.0 million at September 30, 2024[20] - Available borrowings under the Company's line of credit were approximately $92.5 million at June 30, 2025[20] Real Estate Development & Conservation Efforts Alico is actively pursuing its Corkscrew Grove Villages development project, which includes extensive residential and commercial plans alongside significant permanent conservation areas, supported by the newly established Corkscrew Grove Stewardship District Corkscrew Grove Villages Project The Corkscrew Grove Villages project, spanning approximately 4,660 acres, is envisioned to include two 1,500-acre villages with up to 9,000 homes and 560,000 square feet of commercial space, alongside over 6,000 acres of permanent conservation - Corkscrew Grove Villages project is located on approximately 4,660 acres in Collier County, envisioning two 1,500-acre villages[18] - The plan includes approximately 9,000 homes in total (4,500 per village), with about 375 affordable housing units per village, and 560,000 square feet of total commercial space[18] - More than 6,000 acres of sensitive land will be permanently protected as conservation areas within the project[18][22] - The entitlement approval process for the East Village is anticipated to take approximately one year, with a final decision expected in 2026, and construction potentially beginning in 2028 or 2029[19] - The Corkscrew Grove Stewardship District was established to assist in financing infrastructure, restoring natural areas, and overseeing the administration of the master planned communities[3][21] Conservation Strategy Alico maintains a strong commitment to regional conservation, having transferred over 46,807 acres for protection over the past 40 years, with the Corkscrew Grove Villages project dedicating another 6,000 acres to permanent conservation - Alico has a long history of regional conservation efforts, having transferred lands that became part of the Corkscrew Regional Ecosystem Watershed (CREW), Tiger Creek Preserve, and Okaloacoochee Slough Wildlife Management Area[22] - Since 2003, Alico has sold or entered into easements to protect over 46,807 acres, including the 17,000-acre Devil's Garden to the Florida Department of Environmental Protection[23] - The 6,000 acres expected to be placed in conservation as part of the Corkscrew Grove Villages proposal support the implementation of the Florida Wildlife Corridor[23] - Alico's regional conservation strategy is consistent with the Collier Rural Land Stewardship Area (RLSA), an incentive-based approach to sustainable growth[24] Fiscal Year 2025 Guidance Alico completed its final significant citrus harvest in April 2025 and has already exceeded its fiscal year 2025 land sales target, anticipating ending FY2025 with approximately $20 million in Adjusted EBITDA, $25 million in cash, and $60 million in net debt - The Company completed its last significant citrus harvest in April 2025[25] - The Company has exceeded its $20 million land sales guidance for fiscal year 2025[25] - The Company expects to end fiscal year 2025 with enough cash to meet its operating expenses through fiscal year 2027[25] Fiscal Year 2025 Financial Guidance | Metric | Expected FY2025 | | :---------------- | :-------------- | | Adjusted EBITDA | ~$20 million | | Cash (year-end) | ~$25 million | | Net Debt (year-end) | ~$60 million | | Revolving line of credit balance | $2.5 million (minimum required) | Additional Information Conference Call Information Alico, Inc. will host a conference call on August 13, 2025, at 8:30 am Eastern Time to discuss its financial results, with replay information provided - Conference call to discuss financial results scheduled for August 13, 2025, at 8:30 am Eastern Time[27] - A telephone replay will be available from approximately three hours after the call until August 27, 2025[27] About Alico Alico, Inc. is a Florida-based agribusiness and land management company with over 125 years of experience, now operating as a diversified land company focusing on strategic land development and diversified agricultural operations across approximately 51,300 acres - Alico, Inc. is a Florida-based agribusiness and land management company with over 125 years of experience[28] - Following its strategic transformation in 2025, Alico operates as a diversified land company[28] - The Company manages approximately 51,300 acres across 8 Florida counties, focusing on strategic land development and diversified agricultural operations[28] Forward-Looking Statements This press release contains forward-looking statements regarding Alico's strategic transformation, financial projections, and land development plans, which involve inherent risks and uncertainties that could cause actual results to differ materially - Forward-looking statements cover expectations regarding Strategic Transformation, anticipated Adjusted EBITDA, cash flow, debt, future land use and value, profitable growth, land sales, and commercial/residential development (e.g., Corkscrew Grove Villages)[29] - These statements are not guarantees of future performance and involve risks, uncertainties, and assumptions, including securing regulatory approvals, managing resources for new initiatives, market fluctuations, economic conditions, maintaining lender relationships, and addressing environmental/zoning issues[30][31] - The Company does not undertake an obligation to publicly update or revise any forward-looking statement, except as required by law[31] Investor Contact Contact information for investor inquiries is provided, including details for John Mills of ICR and Brad Heine, Alico's Chief Financial Officer - Investor Contact: John Mills (ICR) at (646) 277-1254 or InvestorRelations@alicoinc.com[33] - Investor Contact: Brad Heine (Chief Financial Officer) at (239) 226-2000 or bheine@alicoinc.com[33] Condensed Consolidated Financial Statements Condensed Consolidated Balance Sheets The condensed consolidated balance sheets present Alico's financial position at June 30, 2025, and September 30, 2024, showing a significant increase in cash and cash equivalents and a substantial reduction in property and equipment Condensed Consolidated Balance Sheets (in thousands) | ASSETS | June 30, 2025 (Unaudited) | September 30, 2024 | | :-------------------------------- | :------------------------ | :----------------- | | Current assets: | | | | Cash and cash equivalents | $42,073 | $3,150 | | Accounts receivable, net | 1,610 | 771 | | Inventories | 2,995 | 30,084 | | Income tax receivable | 1,062 | 1,958 | | Assets held for sale | 6,659 | 3,106 | | Prepaid expenses and other current assets | 1,558 | 1,558 | | Total current assets | 55,957 | 40,627 | | Restricted cash | 762 | 248 | | Property and equipment, net | 149,460 | 352,733 | | Goodwill | 2,246 | 2,246 | | Other non-current assets | 2,135 | 2,865 | | Total assets | $210,560 | $398,719 | | LIABILITIES AND STOCKHOLDERS' EQUITY | | | | Current liabilities: | | | | Accounts payable | $916 | $3,362 | | Accrued liabilities | 3,313 | 5,366 | | Current portion of long-term debt | 1,410 | 1,410 | | Other current liabilities | 330 | 513 | | Total current liabilities | 5,969 | 10,651 | | Long-term debt, net | 81,320 | 82,313 | | Lines of credit | 2,500 | 8,394 | | Deferred income tax liabilities, net | 4,004 | 40,873 | | Other liabilities | 67 | 193 | | Total liabilities | 93,860 | 142,424 | | Stockholders' equity: | | | | Common stock | 8,416 | 8,416 | | Additional paid in capital | 20,333 | 20,184 | | Treasury stock, at cost | (26,284) | (26,694) | | Retained earnings | 109,266 | 249,253 | | Total Alico stockholders' equity | 111,731 | 251,159 | | Noncontrolling interest | 4,969 | 5,136 | | Total stockholders' equity | 116,700 | 256,295 | | Total liabilities and stockholders' equity | $210,560 | $398,719 | Condensed Consolidated Statements of Operations The condensed consolidated statements of operations show a decrease in total operating revenues for both Q3 and YTD 2025, with substantially increased operating expenses leading to a significant gross loss and net loss Condensed Consolidated Statements of Operations (in thousands, except per share amounts) | Operating revenues: | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Alico Citrus | $7,805 | $13,237 | $41,384 | $44,591 | | Land Management and Other Operations | 585 | 373 | 1,880 | 1,117 | | Total operating revenues | 8,390 | 13,610 | 43,264 | 45,708 | | Operating expenses: | | | | | | Alico Citrus | 36,304 | 17,813 | 229,022 | 82,062 | | Land Management and Other Operations | 142 | 84 | 233 | 346 | | Total operating expenses | 36,446 | 17,897 | 229,255 | 82,408 | | Gross loss | (28,056) | (4,287) | (185,991) | (36,700) | | General and administrative expenses | 2,867 | 2,441 | 8,841 | 8,034 | | Loss from operations | (30,923) | (6,728) | (194,832) | (44,734) | | Total other income, net | 4,799 | 3,958 | 18,950 | 78,969 | | (Loss) income before income taxes | (26,124) | (2,770) | (175,882) | 34,235 | | Income tax (benefit) provision | (7,800) | (861) | (36,874) | 9,721 | | Net (loss) income | (18,324) | (1,909) | (139,008) | 24,514 | | Net (loss) income attributable to Alico, Inc. common stockholders | $(18,289) | $(2,044) | $(138,841) | $25,097 | | (Loss) earnings per common share: Basic | $(2.39) | $(0.27) | $(18.18) | $3.29 | | (Loss) earnings per common share: Diluted | $(2.39) | $(0.27) | $(18.18) | $3.29 | Condensed Consolidated Statements of Cash Flows The condensed consolidated statements of cash flows for the nine months ended June 30, 2025, show a significant positive shift in net cash provided by operating activities compared to the prior year, resulting in a substantial net increase in cash and cash equivalents Condensed Consolidated Statements of Cash Flows (in thousands) | Metric | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :---------------------------------------------------------------- | :------------------------------ | :------------------------------ | | Net (loss) income | $(139,008) | $24,514 | | Depreciation, depletion and amortization | 170,800 | 11,317 | | Gain on sale of property and equipment | (21,400) | (81,520) | | Impairment of long-lived assets | 24,966 | — | | Inventory net realizable value adjustment | 9,895 | 28,549 | | Deferred income tax (benefit) provision | (36,869) | 458 | | Net cash provided by (used in) operating activities | 22,841 | (18,720) | | Purchases of property and equipment | (4,049) | (15,931) | | Net proceeds from sale of property and equipment | 28,172 | 86,394 | | Net cash provided by investing activities | 24,693 | 70,088 | | Repayments on revolving lines of credit | (25,194) | (44,032) | | Borrowings on revolving lines of credit | 19,300 | 19,310 | | Principal payments on term loans | (1,057) | (20,089) | | Dividends paid | (1,146) | (1,143) | | Net cash used in financing activities | (8,097) | (45,954) | | Net increase in cash and cash equivalents and restricted cash | 39,437 | 5,414 | | Cash and cash equivalents and restricted cash at end of the period | $42,835 | $9,106 | Non-GAAP Financial Measures Non-GAAP Definitions and Revisions Alico utilizes non-GAAP financial measures, including EBITDA, Adjusted EBITDA, and Net Debt, to assess business performance and liquidity, with Adjusted EBITDA revised to better reflect underlying business performance post-Strategic Transformation - Alico uses non-GAAP financial measures: EBITDA, Adjusted EBITDA, and Net Debt, to evaluate business performance and liquidity[40] - The calculation of Adjusted EBITDA has been revised to better reflect underlying business performance post-Strategic Transformation, now adjusting for impairment of long-lived assets and restructuring/other charges[40] - The revision to Adjusted EBITDA increased the reported figures by $4.6 million for the three months and $61.2 million for the nine months ended June 30, 2024[40] - EBITDA is defined as net income before interest expense, provision for income taxes, depreciation, depletion, and amortization. Adjusted EBITDA further adjusts for impairment of long-lived assets and restructuring and other charges. Net Debt is defined as total debt less cash[41] EBITDA and Adjusted EBITDA Reconciliation The reconciliation shows that for Q3 2025, both EBITDA and Adjusted EBITDA significantly increased, while for the nine months ended June 30, 2025, EBITDA was negative and Adjusted EBITDA decreased EBITDA and Adjusted EBITDA Reconciliation (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :------------------------------------------------ | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net (loss) income attributable to Alico, Inc. common stockholders | $(18,289) | $(2,044) | $(138,841) | $25,097 | | Interest expense, net | 754 | 533 | 2,705 | 2,551 | | Income tax (benefit) provision | (7,800) | (861) | (36,874) | 9,721 | | Depreciation, depletion and amortization | 44,539 | 3,715 | 170,800 | 11,317 | | EBITDA | $19,204 | $1,343 | $(2,210) | $48,686 | | Non-GAAP Adjustments: | | | | | | Impairment of long-lived assets | — | — | 24,966 | — | | Restructuring and other charges | 69 | — | 2,574 | — | | Adjusted EBITDA | $19,273 | $1,343 | $25,330 | $48,686 | Net Debt Reconciliation The Net Debt reconciliation illustrates a significant reduction in net debt from $88.967 million at September 30, 2024, to $43.157 million at June 30, 2025, with a forecasted net debt of $59.859 million for September 30, 2025 Net Debt Reconciliation (in thousands) | Metric | June 30, 2025 (Unaudited) | September 30, 2024 | September 30, 2025 (Forecasted) | | :-------------------------- | :------------------------ | :----------------- | :------------------------------ | | Current portion of long-term debt | $1,410 | $1,410 | $1,410 | | Long-term debt, net | 81,320 | 82,313 | 80,949 | | Lines of credit | 2,500 | 8,394 | 2,500 | | Total Debt | 85,230 | 92,117 | 84,859 | | Less: Cash and cash equivalents | (42,073) | (3,150) | (25,000) | | Net Debt | $43,157 | $88,967 | $59,859 |