ALICO INC
For the period ended Dec 31, 2024. Filed Feb 12, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2024 · Filed Feb 12, 2025
ALCO$37.09-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-05.
0000003545-24-000099
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-12-31; filed 2025-02-12.
0000003545-25-000030
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 88 previous paragraphs and 87 current paragraphs.
38 unchanged; 27 reworded; 21 added; 22 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
Conservation Assessment
Current report
As part of Alico’s Strategic Transformation (defined below), we continue to evaluate all our properties to determine what will create the highest and best use of our land. Instrumental in that process is evaluating all opportunities where we can leverage conservation programs to simultaneously create value and enhance environmental outcomes. To that end, Alico has identified five properties, ranging in size from 348 acres to 7,789 acres (for a total of 10,484 acres) as case studies to explore the opportunities provided under Florida’s Rural and Family Lands Protection Program. Those applications were submitted to FDACS prior to the January 29, 2025 deadline, and will be evaluated over the coming months. While not all of the properties may ultimately be a fit for the program, we look forward to coordinating with the Florida Department of Agriculture and Consumer Services to analyze whether these properties fit within the Rural and Family Lands Protection Program as well as our Strategic Transformation framework.
Current report
Strategic Transformation and Workforce Reduction
Current report
On January 6, 2025, we announced a strategic transformation in our business focus, to wind down our Alico Citrus division, which holds our citrus production operations, to focus on a long-term diversified land usage and real estate development strategy (the “Strategic Transformation”). Due to increasing financial challenges from citrus greening disease and environmental factors for many seasons, we have decided to not spend further material capital on our citrus operations and to wind down substantially all of its Citrus’ primary operations after the current crop is harvested in the first half of calendar year 2025. In connection with this Strategic Transformation, on January 3, 2025, our Board of Directors (the “Board”) approved a reduction in our current workforce by up to 172 employees, which occurred effective on or about January 6, 2025 with respect to up to 135 employees, and will be effective on or about April 1, 2025 with respect to up to 37 employees (the “Workforce Reduction”). The Board’s decision is part of cost-reduction initiatives aimed at providing investors with a greater return on capital that includes the benefits and stability of a conventional agriculture investment, with the optionality that comes with active land management.
Current report
We currently estimate that we will incur charges of approximately $1,500 to $2,000 in connection with the Workforce Reduction, primarily consisting of severance payments, employee benefits and related costs. We expect that the majority of these charges will be incurred in the second and third quarters of 2025.
Current report
We may incur additional expenses not currently contemplated due to events associated with the Workforce Reduction. The charges that we expect to incur in connection with the Workforce Reduction are estimates and subject to a number of assumptions, and actual results may differ materially.
Current report
In addition, we have sold and intend to continue to sell many of the vehicles and equipment used in our Citrus operations; however, we are not currently able to estimate the proceeds on sale or the amount of the loss, if any, that may be incurred at this time. Furthermore, with the decision to move away from the Citrus production operations, we anticipate accelerating depreciation on the remaining book value of citrus trees, impacted by this decision, through the end of this year's harvest.
Current report
On January 3, 2025, we delivered a notice (the “Notice”) to Tropicana Manufacturing Company, Inc. (“Tropicana”) in accordance with the Orange Purchase Agreement No. R641, dated April 11, 2024 (the “Agreement”), between us and Tropicana, under which we agree to sell, and Tropicana agrees to purchase, oranges from the groves identified therein. The Agreement grants us the right to remove certain acreages from the contract if, in our best judgment, such acreages are no longer economically viable, provided that Tropicana consents, which consent shall not be unreasonably withheld or delayed.
Current report
As detailed in the Notice, the our Board has determined that certain of the acreage specified in the Agreement is no longer economically viable for orange cultivation. As a result, we have provided the Notice to Tropicana seeking Tropicana’s consent for the removal of such acreage, effective at the end of the 2024/2025 crop year. Consequently, if Tropicana consents, its purchase obligations under the Agreement with respect to such acreage are expected to conclude upon the completion of the 2024/2025 crop year.
Current report
On December 19, 2024, we entered into an agreement to sell 1,177 acres of land for $7,297 ($6,200 per acre).
Current report
Other (Expense) Income, net
Current report
The income tax (benefit) provision was $(2,180) and $15,552 for the three months ended December 31, 2024 and 2023, respectively. The income tax benefit for the three months ended December 31, 2024 was principally due to the pre-tax loss and adjusted, primarily for the increased valuation allowance, which has been included in the annual effective tax rate. Based on both positive and negative evidence, management determined that it was not “more likely than not” the deferred tax assets will be realized. This is primarily due to the planned acceleration of book depreciation on the citrus producing assets, which is anticipated to result in a cumulative three-year loss during fiscal year ending September 30, 2025.
Current report
The 20.1% increase in revenue for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, was primarily due to a 38.7% increase in the price per pound solid, partially offset by a (13.3)% decrease in pound solids produced by the Early and Mid-Season harvest. The increase in the price per pound solid is the result of more favorable pricing in one of our contracts with Tropicana; however as a result of fruit drop caused by Hurricane Milton, we picked fewer pound solids than in the prior year period.
Current report
For the three months ended December 31, 2024, Harvesting and Hauling expenses were relatively flat, when compared to the same period in the prior year, despite a (12.5)% decrease in boxes harvested, due to an increase in the cost per box harvested, partially offset by fewer boxes being harvested.
Current report
The 24.5% increase in operating expenses relating to grove management services for the three months ended December 31, 2024 compared to December 31, 2023 was due to a significant increase in caretaking services performed at the request of one of our Grove Management Services customers.
Current report
a - Excludes deferred financing costs
Current report
During the three months ended December 31, 2024, we recorded an additional valuation allowance against our deferred tax assets, which is recorded in the annual effective tax rate. We are required to assess the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss expected to be incurred over a three-year period during the year ending September 30, 2025. Such objective evidence limits the ability to consider other subjective evidence, such as our projections for future growth. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as our projections for growth.
Current report
The $5,572 decrease in Net cash used in operating activities was driven by an increase in revenue due to an increase in the price per pound, solid as the result of more favorable pricing in one of our contracts with Tropicana, and lower spending on caretaking (resulting in a lower inventory balance) during the three months ended December 31, 2024, as compared to the three months ended December 31, 2023.
Current report
The $(78,242) change in Net cash (used in) provided by investing activities for the three months ended December 31, 2024, compared to the three months ended December 31, 2023, was principally the result of there being no land sales in the three months ended December 31, 2024, as compared to proceeds of $79,090, driven by the sale of the Alico Ranch to the State of Florida during the three months ended December 31, 2023.
Current report
Variable-Rate Term debt and the outstanding balance on the WCLC, with the proceeds from the sale of 17,229 acres of the Alico Ranch in the prior year period.
Current report
At December 31, 2024 and September 30, 2024, $73,506 and $86,606, respectively, were available under the RLOC.
Removed paragraphs (22)
Previous report
On June 5, 2024, we entered a new three-year Orange Purchase Agreement (the “Tropicana Agreement”) to sell oranges to Tropicana at prices that are approximately 33% to 50% higher, over the life of the contract, than the average price for all the citrus fruit sold to Tropicana last season. The Tropicana Agreement is effective June 5, 2024 through July 31, 2027, subject to its terms and conditions, and succeeds existing agreements with Tropicana that expired at the end of July 2024.
Previous report
Citrus Research and Field Trial Foundation
Previous report
In June 2024, we received $1,106 from CRAFT of grower’s support payments in connection with our use of OTC, to combat the effect of “greening” in our citrus trees.
Previous report
On June 28, 2024, we sold 798 acres of citrus land for approximately $7,183 ($9,000 per acre).
Previous report
The 16.7% increase in revenue for the nine months ended June 30, 2024, as compared to the nine months ended June 30, 2023, was primarily due to an increase in pound solids produced as we began to recover to pre-hurricane levels and an increase in the price per pound solids for both the Early and Mid-season and Valencia crops, as a result of more favorable pricing in one of our contracts with Tropicana, which is discussed in further detail below. In addition, there was an increase in Grove Management Services revenue as a result of the Citrus Grove Management Agreement we entered into on October 30, 2023 (the “Grove Owners Agreement”) with an unaffiliated group of third parties (the “Grove Owners”) to provide citrus grove caretaking services for approximately 3,300 acres owned by such third parties for the nine months ended June 30, 2024, as compared to the nine months ended June 30, 2023.
Previous report
General and administrative expense decreased $72 for the nine months ended June 30, 2024, compared to the nine months ended June 30, 2023, primarily due to lower depreciation, legal and insurance costs, partially offset by increased employee costs.
Previous report
Other Expense, net
Previous report
Other Expense, net for the nine months ended June 30, 2024 increased $75,175, compared to the nine months ended June 30, 2023, primarily due to the sale of 17,229 acres of the Alico Ranch to the State of Florida and the sale of 798 acres of citrus land during the nine months ended June 30, 2024. By comparison, for the nine months ended June 30, 2023 we recognized gains on sale of property and equipment of approximately $7,368 relating to the sale of 1,436 acres, in the aggregate, from the Alico Ranch to several third parties.
Previous report
The decrease in the income tax (benefit) provision of $(2,784) for the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, was driven by a pre-tax loss for the current period, as opposed to pre-tax income in the three months ended June 30, 2023.
Previous report
The increase in the income tax (benefit) provision of $9,415 for the nine months ended June 30, 2024, as compared to the nine months ended June 30, 2023, was principally due to the gain on the sale of 17,229 acres of the Alico Ranch to the State of Florida in the current year, while the income tax provision for the nine months ended June 30, 2023 was due to the lower pre-tax income generated for the period.
Previous report
The 97.2% increase in revenue for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, was primarily due to a 100.5% increase in pound solids, driven by a combination of factors related to the timing of the Valencia harvest, which started later this year to allow the fruit more time to mature, as compared to an acceleration of the harvest in the prior year as a result of Hurricane Ian, to try to mitigate the fruit drop.
Previous report
The 17.6% increase in revenue for the nine months ended June 30, 2024, as compared to the nine months ended June 30, 2023, was primarily due to an 10.8% increase in pound solids produced as the trees continue to recover from the effects of Hurricane Ian, an increase in the price per pound solids for both the Early and Mid-season and Valencia crops as a result of more favorable pricing in one of our contracts with Tropicana, and an increase in Grove Management Services revenue as a result of the signing of the Grove Owners Agreement. Although Hurricane Ian initially impacted the fiscal year 2023 harvest, we expect it may take another season, or more, for the groves to recover to pre-hurricane production levels.
Previous report
The Early and Mid-Season harvest was completed in the second quarters of 2024 and 2023. For the nine months ended June 30, 2024 the pound solids per box decreased 4.0%, and the processed box production increased 22.0%, compared to the same nine month period in the prior year. Although the overall decrease in pound solids per box for the season was disappointing, the increase in total boxes produced demonstrates that the groves are beginning to recover from the effects of Hurricane Ian. In addition, there was an increase in the price per pound solids of 3.8% in the Early and Mid-Season fruit harvested for the nine months ended June 30, 2024, compared to the same period in the prior year, as a result of more favorable pricing in one of our contracts with Tropicana.
Previous report
The Valencia harvest was completed for the three and nine months ended June 30, 2024 and pound solids per box decreased 1.3% and 3.1%, respectively, and the processed box production increased 103.1% and 11.1%, respectively, compared to the same three and nine month periods in the prior year. In addition, there was an increase in the price per pound solids of 0.3% and 4.1% in the Valencia fruit harvested for the three and nine months ended June 30, 2024, respectively, compared to the same periods in the prior year, as a result of more favorable pricing in one of our contracts with Tropicana.
Previous report
For the three month period ended June 30, 2024, Harvest and Hauling expenses increased $1,249, compared to the prior year period, driven by the increase in the number of boxes produced for the period as a result of the timing of our harvest. For the nine months ended June 30, 2024, Harvesting and Hauling expenses were up $1,270, when compared to the same period in the prior year, driven by the increase in the number of boxes produced for the period as we continue to recover from the impact of Hurricane Ian.
Previous report
For the three and nine month periods ended June 30, 2024, the credit amounts shown in “Fresh Fruit and Other” in operating expenses above primarily represent a final true-up of Crop Insurance Proceeds from Hurricane Ian, received in the current period. For the three and nine month periods ended June 30, 2023, the credit amounts primarily represent the Crop Insurance Proceeds of $16,643 and $21,403, respectively, which were recorded as a reduction of operating expenses, and includes $1,315 in federal relief proceeds received under the CRBG program in the nine months ended June 30, 2023.
Previous report
There was a 129.1% and 159.5% increase in operating expenses relating to grove management services for the Grove Owners for the three and nine months ended June 30, 2024 and 2023, respectively, primarily due to the new Grove Owners Agreement.
Previous report
June 30, 2024, as compared to the nine months ended June 30, 2023, was primarily due to an increase in mining permitting costs, offset by a decrease in property taxes related to land sales.
Previous report
The $(18,102) increase in Net Cash (used in) operating activities was driven by Crop Insurance Proceeds of $21,403 during the nine months ended June 30, 2023, partially offset by increased revenues for the nine months ended June 30, 2024.
Previous report
The $75,806 increase in Net Cash provided by (used in) investing activities for the nine months ended June 30, 2024, compared to the nine months ended June 30, 2023, was primarily due to proceeds from the sale of 17,229 acres of the Alico Ranch and the 798 acres of citrus land.
Previous report
We had $0 and $17,910 outstanding on our revolving lines of credit as of June 30, 2024 and June 30, 2023, respectively.
Previous report
The WCLC agreement provides for Rabo Agrifinance, Inc. to issue up to $2,000 in letters of credit on our behalf. As of June 30, 2024, there was $248 in outstanding letters of credit, which correspondingly reduced our availability under the WCLC.
Reworded paragraphs (27)
Previous wording
Alico, Inc., together with its subsidiaries (collectively, “Alico”, the “Company”, “we”, “us” or “our”) generates operating revenues primarily from the sale of our citrus products, providing management services to citrus groves owned by third parties, and grazing and hunting leasing. We operate as two business segments, and all of our operating revenues are generated in the United States. For the three months ended June 30, 2024 and June 30, 2023, we generated operating revenue of $13,610 and $7,284, respectively, (loss) income from operations of $(6,728) and $12,572, respectively, and net (loss) income attributable to common stockholders of $(2,044) and $11,832, respectively. Net cash used in operating activities was $18,720 and $618 for the nine months ended June 30, 2024 and June 30, 2023, respectively.
Current wording
Alico, Inc., together with its subsidiaries (collectively, “Alico”, the “Company”, “we”, “us” or “our”) currently generates operating revenues primarily from the sale of our citrus products, providing management services to citrus groves owned by third parties, and grazing and hunting leasing. We operate as two business segments, and all of our operating revenues are generated in the United States. While Alico Citrus, which holds the Company’s citrus production operations, will cease operations after the 2024/2025 harvest due to environmental and financial challenges, Alico remains committed to Florida’s agriculture industry, and will focus on its long-term diversified land usage and real estate development strategy.
Previous wording
For the three months ended June 30, 2024 and 2023, the Alico Citrus segment generated 97.3% and 92.1%, respectively, of our consolidated revenues and the Land Management and Other Operations segment generated 2.7% and 7.9%, respectively, of our consolidated revenues.
Current wording
For the three months ended December 31, 2024 and 2023, the Alico Citrus segment generated 96.6% and 97.2%, respectively, of our consolidated revenues and the Land Management and Other Operations segment generated 3.4% and 2.8%, respectively, of our consolidated revenues.
Previous wording
The following discussion provides an analysis of our results of operations for the three and nine months ended June 30, 2024, as compared to 2023:
Current wording
The following discussion provides an analysis of our results of operations for the three months ended December 31, 2024, as compared to 2023:
Previous wording
The 86.8% increase in revenue for the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, was primarily due to the timing of the Valencia harvest, which is discussed in further detail below.
Current wording
The 20.8% increase in revenue for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, was primarily due to a 38.7% increase in the price per pound solid and a 11.6% increase in Grove management services, partially offset by a (13.3)% decrease in pound solids produced by the Early and Mid-Season harvest, which is discussed in further detail below.
Previous wording
The increase in operating expenses for the three and nine months ended June 30, 2024, as compared to the three and nine months ended June 30, 2023, was primarily driven by insurance proceeds of $16,643 and $21,403 for crop claims received during the three and nine months ended June 30, 2023 (the “Crop Insurance Proceeds”), which were recorded as a reduction of operating expenses. In addition, the increase in operating expenses for the three and nine months ended June 30, 2024 was impacted by a combination of the inventory adjustments recorded at September 30, 2022 on the ending inventory balance, as a result of the impact of Hurricane Ian, which effectively lowered the inventory to be expensed in fiscal year 2023, as well as a 103.1% and 15.1% increase in the number of boxes which needed to be harvested in the three and nine months ended June 30, 2024, respectively. See Note 3. Inventories to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report.
Current wording
The decrease in operating expenses for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, was primarily driven by a combination of the inventory adjustments recorded at September 30, 2024 on the ending inventory balance, as a result of the continued weak recovery from Hurricane Ian and the ongoing effects of citrus greening, which effectively lowered the inventory to be expensed in fiscal year 2025 and an inventory adjustment of $7,359 recognized at December 31, 2024, as compared to an inventory adjustment of $10,846 at December 31, 2023, which is discussed in further detail below. See Note 3. Inventories to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report.
Previous wording
General and administrative expense decreased $489 for the three months ended June 30, 2024, compared to the three months ended June 30, 2023. The decrease was primarily due to lower employee costs (as a result of lower bonus accruals), lower depreciation, lower legal costs (as a result of the voluntary dismissal of the shareholder lawsuit in the prior year), and lower accounting and insurance costs.
Current wording
General and administrative expense decreased $686 for the three months ended December 31, 2024, compared to the three months ended December 31, 2023. The decrease was primarily due to lower employee costs (as a result of lower bonus accruals) and lower professional fees.
Previous wording
Other Expense, net for the three months ended June 30, 2024 increased $2,535, compared to the three months ended June 30, 2023, driven by gains of $4,396 on the sale of 798 acres of citrus land during the quarter ended June 30, 2024 compared to gains of $2,613 on the sale of 548 acres of the Alico Ranch during the quarter ended June 30, 2023.
Current wording
Other (Expense) Income, net for the three months ended December 31, 2024 was a loss of $(607) as compared to income of $75,515 during the three months ended December 31, 2023, principally as a result of there being no land sales in the three months ended December 31, 2024, as compared to gains of $77,025 during the quarter ended December 31, 2023, driven by the sale of the Alico Ranch to the State of Florida.
Previous wording
Comparison of the Three and Nine Months Ended June 30, 2024 and 2023 for the Alico Citrus Segment
Current wording
Comparison of the Three Months Ended December 31, 2024 and 2023 for the Alico Citrus Segment
Previous wording
For the three and nine months ended June 30, 2024, we recognized a decrease in revenue from sales of Fresh Fruit and Other of $113 and $190, respectively, compared to the same periods in the prior year, driven by a decrease in the amount of fruit that was resold on behalf of grove owners.
Current wording
For the three months ended December 31, 2024, we recognized an increase in revenue from sales of Fresh Fruit and Other of $120, compared to the same period in the prior year, driven by a 19.4% increase in the amount of Fresh Fruit and Other that was produced.
Previous wording
Revenue for the three and nine months ended June 30, 2024 from the grove owners relating to Grove Management Services increased 121.5% and 139.4%, respectively, compared to the prior year, principally due to the signing of the Grove Owners Agreement in October 2023.
Current wording
Revenue for the three months ended December 31, 2024 from the grove owners relating to Grove Management Services increased 11.6%, compared to the prior year, principally due to a significant increase in caretaking services performed at the request of one of our Grove Management Services customers.
Previous wording
For the three and nine months ended June 30, 2024, we recognized an increase in Cost of Sales of $7,435 and $23,210, respectively, compared to the same periods in the prior year, which was driven by a combination of the inventory adjustments recorded at September 30, 2022 on the ending inventory balance as a result of the impact of Hurricane Ian, which effectively lowered the inventory to be expensed in fiscal year 2023, as well as a 103.1% and 15.1% increase in boxes harvested in the three and nine months ended June 30, 2024, respectively, compared to the same periods in the prior year.
Current wording
For the three months ended December 31, 2024, we recognized a decrease in Cost of Sales of $3,094 compared to the same period in the prior year, which was driven by a combination of the inventory adjustment recorded at September 30, 2024 on the ending inventory balance, as a result of the continued weak recovery from Hurricane Ian and the ongoing effects of citrus greening, which effectively lowered the inventory to be expensed in fiscal year 2025 and an inventory adjustment of $7,359 recognized at December 31, 2024, as compared to an inventory adjustment of $10,846 at December 31, 2023, as a result of the slow recovery of our trees from the effects of Hurricane Ian in September 2022.
Previous wording
The table below presents key operating measures for the three and nine months ended June 30, 2024 and 2023 for the Land Management and Other Operations segment:
Current wording
The table below presents key operating measures for the three months ended December 31, 2024 and 2023 for the Land Management and Other Operations segment:
Previous wording
Land and Other Leasing includes lease income from leases for grazing rights, hunting leases, a farm lease, a lease to a third party of an aggregate mine, leases of oil extraction rights to third parties, and other miscellaneous income.
Current wording
Land and Other Leasing includes lease income from leases for grazing rights, hunting leases, a farm lease, leases to third parties of aggregate mines, leases of oil extraction rights to third parties, and other miscellaneous income.
Previous wording
Comparison of the Three and Nine Months Ended June 30, 2024 and 2023 for the Land Management and Other Operations Segment
Current wording
Comparison of the Three Months Ended December 31, 2024 and 2023 for the Land Management and Other Operations Segment
Previous wording
Land Management and Other Operations revenue for the three and nine months ended June 30, 2024 decreased 34.8% and 10.6%, respectively, as compared to the same period in the prior year principally due to a decrease in hunting lease revenue as a result of the sale of the ranch land.
Current wording
Land Management and Other Operations revenue for the three months ended December 31, 2024 increased 44.5% as compared to the same period in the prior year principally due to an increase in rock and sand royalty income and sod sales, partially offset by lower farm, grazing and hunting lease revenues due to the sale of the Alico Ranch.
Previous wording
The decrease in operating expenses from Land Management and Other Operations for the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, was primarily due to a decrease in property taxes related to land sales. The increase in operating expenses from Land Management and Other Operations for the nine months ended
Current wording
The decrease in operating expenses from Land Management and Other Operations for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, was primarily due to lower property and real estate taxes as a result of the sale of the Alico Ranch.
Previous wording
We are primarily engaged in the production of fruit for sale to citrus markets, which is of a seasonal nature, and subject to the influence of natural phenomena and wide price fluctuations. Historically, the second and third quarters of our fiscal year produce most of our annual revenue. However, due to the timing of the current year harvest, more of the citrus crop was harvested in the first and second quarters of this fiscal year. Working capital requirements are typically greater in the first and fourth quarters of the fiscal year, coinciding with harvesting cycles. Because of the seasonality of the business, results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year.
Current wording
We have historically been primarily engaged in the production of fruit for sale to citrus markets, which is of a seasonal nature, and subject to the influence of natural phenomena and wide price fluctuations. As a result, the second and third quarters of our fiscal year produce most of the Company’s annual revenue. However, due to lower production in the current and prior years, more of the citrus crop was harvested in the first and second quarters of the fiscal years. Working capital requirements are typically greater in the first and fourth quarters of the fiscal year, coinciding with harvesting cycles; however, as the harvest cycles have moved, our working capital requirements are now greater in the third and fourth quarters of the fiscal year. Because of the seasonality of the business, results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year. In light of the Strategic Transformation, we have decided not to allocate additional material capital to our citrus operations. As a result, we expect these seasonal patterns to diminish as we wind down those operations.
Previous wording
Our business has historically generated full fiscal year positive net cash flows from operating activities, although the net cash flow in the first quarter of each fiscal year has been negative because of seasonality and the associated need to expend cash in advance of generating revenues from the harvesting season. Sources of cash primarily include cash flows from operations, sales of under-performing land and other assets, amounts available under our credit facilities, and access to capital markets. Access to additional borrowings under revolving lines of credit is subject to the satisfaction of customary borrowing conditions. As a public company, we may have access to other sources of capital. However, access to, and availability of, financing on acceptable terms in the future will be affected by many factors, including (i) financial condition, prospects, and credit rating; (ii) liquidity of the overall capital markets; and (iii) the state of the economy. There can be no assurance that we will continue to have access to the capital markets on acceptable terms, or at all.
Current wording
Our business has historically generated full fiscal year positive net cash flows from operating activities, although the net cash flow in the first quarter of each fiscal year has been negative because of seasonality and the associated need to expend cash in advance of generating revenues from the harvesting season. In light of recent hurricanes, costs of maintaining the citrus groves and harvesting and hauling of citrus products continue to increase, and we continue to evaluate the short and long-term use of our land, and in January 2025 we announced a strategic transformation in our business focus, to wind down our Alico Citrus division, which holds our citrus production operations, to focus on a long-term diversified land usage and real estate development strategy. Sources of cash primarily include cash flows from operations, sales of under-performing land and other assets, amounts available under our credit facilities, and access to capital markets. Access to additional borrowings under our RLOC is subject to the satisfaction of customary borrowing conditions. As a public company, we may have access to other sources of capital. However, access to, and availability of, financing on acceptable terms in the future will be affected by many factors, including (i) financial condition, prospects, and credit rating; (ii) liquidity of the overall capital markets; and (iii) the state of the economy. There can be no assurance that we will continue to have access to the capital markets on acceptable terms, or at all.
Previous wording
The principal uses of cash that affect our liquidity position include the following: operating expenses including employee costs, the cost of maintaining the citrus groves, harvesting and hauling of citrus products, capital expenditures, stock repurchases, dividends, debt service costs including interest and principal payments on term loans and other credit facilities and acquisitions. Although the current year tax provision is recorded within Income taxes payable on our balance sheet, as required by U.S. GAAP; we do not expect to pay any further income taxes for the fiscal year ended September 30, 2024. The income tax payable is expected to be reclassified to Deferred income tax liabilities, net, at year-end, as we anticipate utilizing a portion of our prior year net operating loss carryover.
Current wording
The principal uses of cash that affect our liquidity position include the following: operating expenses including employee costs, the cost of maintaining the citrus groves, harvesting and hauling of citrus products, capital expenditures, stock repurchases, dividends, debt service costs including interest and principal payments on term loans and other credit facilities and acquisitions. Our expected principal uses of cash that affect our liquidity position, in light of the strategic transformation and the workforce reduction, are expected to include lower employee costs, lower costs of maintaining citrus groves and lower capital expenditures.
Previous wording
Management believes that a combination of cash-on-hand, cash generated from operations, and asset sales and availability under our lines of credit will provide sufficient liquidity to service the principal and interest payments on our indebtedness and will satisfy working capital requirements and capital expenditures for at least the next twelve months and over the long term. However, this is subject, to a certain extent, on general economic, financial, competitive, regulatory and other factors that are beyond our control.
Current wording
Management believes that a combination of cash-on-hand, cash generated from operations, asset sales and availability under our RLOC will provide sufficient liquidity to service the principal and interest payments on our indebtedness and will satisfy working capital requirements and capital expenditures for at least the next twelve months and over the long term. However, this is subject, to a certain extent, on general economic, financial, competitive, regulatory and other factors that are beyond our control.
Previous wording
We have a $70,000 working capital line of credit and a $25,000 revolving line of credit, of which $69,752 and $25,000 was available for general use as of June 30, 2024 (see Note 7. Long-Term Debt and Lines of Credit to the accompanying Condensed Consolidated Financial Statements). We may utilize the available cash to pay down indebtedness, pursue citrus grove acquisitions, conduct share repurchases, and possibly reinstate increased dividends. If we choose to pursue significant growth and other corporate opportunities, these actions could have a material adverse impact on our cash balances and may require us to finance such activities by drawing down on our lines of credit or by obtaining additional debt or equity financing. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. Any inability to obtain additional financing could adversely impact our ability to pursue different growth and other corporate opportunities.
Current wording
We have a $95,000 RLOC, of which $73,506 and $86,606 was available for general use as of December 31, 2024 and September 30, 2024, respectively (see Note 7. Long-Term Debt and Lines of Credit to the accompanying Condensed Consolidated Financial Statements). We may utilize the available cash to pay down indebtedness, pursue citrus grove acquisitions, conduct share repurchases, and possibly reinstate increased dividends. If we choose to pursue significant growth and other corporate opportunities, these actions could have a material adverse impact on our cash balances and may require us to finance such activities by drawing down on our lines of credit or by obtaining additional debt or equity financing. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. Any inability to obtain additional financing could adversely impact our ability to pursue different growth and other corporate opportunities.
Previous wording
The level of debt could have important consequences on our business, including, but not limited to, increasing our vulnerability to general adverse economic and industry conditions, limiting the availability of cash flow to fund future investments, capital expenditures, working capital, business activities and other general corporate requirements, and limiting flexibility in planning for, or reacting to, changes in its business and industry.
Current wording
The level of debt could have important consequences on our business, including, but not limited to, increasing our vulnerability to general adverse economic and industry conditions, limiting the availability of cash flow to fund future investments, capital expenditures, working capital, business activities and other general corporate requirements, and limiting flexibility in planning for, or reacting to, changes in our business and industry.
Previous wording
Our credit facilities are subject to various debt covenants including the following financial covenants: (i) minimum debt service coverage ratio of 1.10 to 1.00; (ii) tangible net worth of at least $160,000 increased annually by 10% of consolidated net income for the preceding years, or $174,628 applicable for the year ended September 30, 2023; (iii) minimum current ratio of 1.50 to 1.00; (iv) debt to total assets ratio not greater than 0.625 to 1.00; and (v) solely in the case of the WCLC, a limit on capital expenditures of $30,000 per fiscal year. As of June 30, 2024, we were in compliance with all of the financial covenants.
Current wording
Our credit facilities are subject to various debt covenants including the following financial covenants: (i) minimum debt service coverage ratio of 1.10 to 1.00; (ii) tangible net worth of at least $160,000 increased annually by 10% of consolidated net income for the preceding years, or $175,263 applicable for the year ended September 30, 2025; (iii) minimum current ratio of 1.50 to 1.00; and (iv) debt to total assets ratio not greater than 0.625 to 1.00. The Amended Credit Agreement also includes a 55.0% LTV CAP on the value of the term loans and RLOC capacity. At December 31, 2024, the Company was able to draw the entire amount of the RLOC, less current borrowings, and remain under the LTV Cap.
Previous wording
Cash and cash equivalents increased from $1,592 as of June 30, 2023, to $9,106 as of June 30, 2024. The components of these changes are discussed below.
Current wording
Cash and cash equivalents and restricted cash decreased from $21,262 as of December 31, 2023, to $5,150 as of December 31, 2024. The components of these changes are discussed below.
Previous wording
Net Cash (Used In) Provided By Financing Activities
Current wording
Net Cash (Used In) Provided By Investing Activities
Previous wording
Net Cash Provided By (Used In) Investing Activities
Current wording
Net Cash Provided By (Used In) Financing Activities
Previous wording
The increase of $(53,017) in Net Cash (used in) provided by financing activities for the nine months ended June 30, 2024, as compared to the nine months ended June 30, 2023, was primarily due to the repayment of the WCLC and the $19,094 Met Life Variable-Rate Term debt with the proceeds from the sale of 17,229 acres of the Alico Ranch, as compared to an increase in net borrowings under the WCLC in the same period in the prior year.
Current wording
The increase of $56,852 in Net cash provided by (used in) financing activities for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, was primarily due to the an increase in net borrowings under the RLOC during three months ended December 31, 2024, as compared to the repayment of $19,094 of Met Life
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
For the three months ended December 31, 2024 and December 31, 2023, we generated operating revenue of $16,894 and $13,985, respectively, loss from operations of $(10,824) and $(17,527), respectively, and net (loss) income attributable to common stockholders of $(9,167) and $42,945, respectively. Net cash used in operating activities was $7,597 and $13,169 for the three months ended December 31, 2024 and December 31, 2023, respectively.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
For the nine months ended June 30, 2024 and 2023, the Alico Citrus segment generated 97.6% and 96.8%, respectively, of our consolidated revenues and the Land Management and Other Operations segment generated 2.4% and 3.2%, respectively, of our consolidated revenues.