TEJON RANCH, Calif.--(BUSINESS WIRE)--Nov. 7, 2016--
Tejon Ranch Co. (NYSE:TRC), a diversified real estate and agribusiness
company, which is in the process of planning and entitling three master
plan communities and executing the development of a large scale
commercial center, today released its results of operations for the
three- and nine-months ended September 30, 2016.
Quarter Ended September 30, 2016 Financial Highlights
-
Revenues from operations for the third quarter of 2016 totaled $13.1
million, an increase of $1.2 million, or 9%, compared to $11.9 million
in revenues for the same period in 2015.
-
Pistachio revenues increased a net $3.6 million after recovering
from the mild winter of 2015 that decimated 90% of our crop
yields. The depressed 2015 crop prevented the possibility of
having meaningful carryover crop sales in 2016. Comparatively,
crop yields were 3.2 million pounds and 73 thousand pounds during
2016 and 2015, respectively.
-
Almond revenues decreased $2.4 million resulting from declines in
market prices and timing of crops sales.
-
Equity in earnings from unconsolidated joint ventures for the third
quarter of 2016 was $2.4 million, an increase of $0.3 million, or 15%,
compared to $2.1 million for the same period in 2015. The increase was
driven by higher fuel margins from our TA/Petro joint venture as a
result of lower inventory costs. The joint venture also saw an
increase in diesel and gasoline sales volume.
-
Net income attributable to common stockholders for the third quarter
of 2016 was $0.3 million, representing net income per common share of
$0.02, compared to net loss of $0.8 million, or loss per common share
of $0.04, for the same period in 2015. All per share numbers in this
release are diluted earnings per common share.
Year-to-Date Financial Highlights
-
Revenues from operations for the nine-months ended September 30, 2016
totaled $32.9 million, a decrease of $2.7 million, or 8%, compared to
revenues of $35.6 million for the same period in 2015. The decrease in
revenues was mainly due to the following:
-
Almond revenues decreased $4.4 million resulting from declining
market prices and timing of crop sales relative to the same period
in 2015.
-
Oil royalty revenues decreased $1.2 million due to declines in
both the price per barrel of oil and production volume.
-
Offsetting the decreases in almond and oil royalty revenues were
net increases in pistachio revenues of $3.1 million after
recovering from the mild winter of 2015 that decimated 90% of our
crop yields. The depressed 2015 crop prevented the possibility of
having meaningful carryover crop sales in 2016. Comparatively,
crop yields were 3.2 million pounds and 73 thousand pounds during
2016 and 2015, respectively.
-
Equity in earnings from unconsolidated joint ventures for the
nine-months ended September 30, 2016 was $5.7 million, an increase of
$0.8 million, or 16%, compared to $4.9 million for the same period in
2015. The increase was driven by higher fuel margins from our TA/Petro
joint venture as a result of lower inventory costs. The joint venture
also saw an increase in diesel and gasoline sales volume.
-
Net income attributable to common stockholders for the nine months
ended September 30, 2016 was $0.8 million, representing earnings per
common share of $0.04, compared to net income of $1.2 million, or
earnings per common share of $0.06, for the same period in 2015.
2016 Operational Highlights
-
On October 27, 2016, the Kern County Planning Commission unanimously
recommended approval of the company’s Grapevine community by the Kern
County Board of Supervisors after its review of the Environmental
Impact Report and the Grapevine Specific and Community Plan, which is
the final step in the local plan approval process. The company’s
master planned Grapevine community includes 12,000 residential units
and 5.1 million square feet of commercial and industrial space. The
Kern County Board of Supervisors is expected to take action on the
recommendation in December 2016.
-
On August 6, 2016, we entered into a limited liability company
agreement forming a joint venture with Majestic Realty Co. to
purchase, own, and manage a fully-leased, 651,909-square-foot
industrial building located at the Tejon Ranch Commerce Center. The
joint venture purchased the building in September for $24.8 million
which was financed through a $21.1 million promissory note guaranteed
by both partners. The agreement is structured so that each member has
a 50% interest.
-
On September 9, 2016, we entered into a limited liability agreement
forming a joint venture with Majestic Reality Co. for the development
of, ownership of, and management of a 480,480-square-foot industrial
building at the Tejon Ranch Commerce Center. We are in the process of
planning and designing the building. The agreement is structured so
that each member has a 50% interest.
2016 Outlook:
We believe our capital structure provides a solid foundation for
continued investment in ongoing and future projects. As of September 30,
2016, total capital, including long-term debt, was approximately $407.5
million. We also have cash and securities totaling approximately $31.0
million and $19.0 million available on our line of credit.
We will continue to, either independently or through joint ventures,
aggressively pursue development, leasing, and investment within the
Tejon Ranch Commerce Center. We continue to invest in our master planned
communities, including the completion of entitlements for Centennial and
Grapevine and in pre-development activities for Mountain Village at
Tejon Ranch. California is one of the most highly regulated states to
engage in real estate development and, as such, delays, including those
resulting from litigation, can be reasonably anticipated. Accordingly,
throughout the next few years, we expect net income to fluctuate from
year-to-year based upon commodity prices, production within our farming
segment, and the timing of sales of land and the leasing of land within
our commercial/industrial developments.
We believe the variability of our operating results will continue
through the remainder of 2016 due to the seasonal nature of our farming
and real estate activities. Mineral resource revenue from oil royalties
is expected to be negatively impacted during the remainder of 2016 due
to lower average prices for oil and reduced production tied to lower
prices. Almond and wine grape yields for 2016 are comparable to those of
prior years. Pistachio yields are near historic highs recovering from
the 2015 lows brought about by the 2015 mild winter. Almond and
pistachio commodity prices have declined $1.00 to $1.50 per pound as a
result of increased supply in the marketplace. These lower nut prices
could carry forward into 2017 as a result of the increased supply. Wine
grape prices remain consistent with prior years.
About Tejon Ranch Co.
Tejon Ranch Co. (NYSE: TRC) is a diversified real estate development and
agribusiness company, whose principal asset is its 270,000-acre land
holding located approximately 60 miles north of Los Angeles and 30 miles
south of Bakersfield.
More information about Tejon Ranch Co. can be found on our website at www.tejonranch.com.
Forward-Looking Statements:
The statements contained herein, which are not historical facts, are
forward-looking statements based on economic forecasts, strategic plans
and other factors, which by their nature involve risk and uncertainties.
In particular, among the factors that could cause actual results to
differ materially are the following: business conditions and the general
economy, future commodity prices and yields, market forces, the ability
to obtain various governmental entitlements and permits, interest rates
and other risks inherent in real estate and agriculture businesses. For
further information on factors that could affect the Company, the reader
should refer to the Company’s filings with the Securities and Exchange
Commission.
|
TEJON RANCH CO.
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(In thousands, except earnings per share)
|
|
(Unaudited)
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
|
2016
|
|
|
|
2015
|
|
|
|
2016
|
|
|
|
2015
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Real estate - commercial/industrial
|
|
$
|
2,221
|
|
|
$
|
2,101
|
|
|
$
|
6,534
|
|
|
$
|
6,190
|
|
|
Mineral resources
|
|
|
1,125
|
|
|
|
1,322
|
|
|
|
13,052
|
|
|
|
14,174
|
|
|
Farming
|
|
|
9,319
|
|
|
|
8,076
|
|
|
|
11,042
|
|
|
|
12,470
|
|
|
Ranch operations
|
|
|
414
|
|
|
|
447
|
|
|
|
2,253
|
|
|
|
2,745
|
|
|
Total revenues from Operations
|
|
|
13,079
|
|
|
|
11,946
|
|
|
|
32,881
|
|
|
|
35,579
|
|
|
Operating Profits:
|
|
|
|
|
|
|
|
|
|
Real estate - commercial/industrial
|
|
|
474
|
|
|
|
502
|
|
|
|
1,394
|
|
|
|
1,306
|
|
|
Real estate - resort/residential
|
|
|
(323
|
)
|
|
|
(558
|
)
|
|
|
(1,252
|
)
|
|
|
(1,885
|
)
|
|
Mineral resources
|
|
|
458
|
|
|
|
716
|
|
|
|
5,892
|
|
|
|
7,151
|
|
|
Farming
|
|
|
1,538
|
|
|
|
(47
|
)
|
|
|
405
|
|
|
|
760
|
|
|
Ranch operations
|
|
|
(960
|
)
|
|
|
(1,227
|
)
|
|
|
(2,010
|
)
|
|
|
(1,941
|
)
|
|
Income (loss) from Operating Segments
|
|
|
1,187
|
|
|
|
(614
|
)
|
|
|
4,429
|
|
|
|
5,391
|
|
|
Investment income
|
|
|
112
|
|
|
|
116
|
|
|
|
350
|
|
|
|
413
|
|
|
Other income
|
|
|
32
|
|
|
|
125
|
|
|
|
120
|
|
|
|
180
|
|
|
Corporate expense
|
|
|
3,096
|
|
|
|
2,927
|
|
|
|
9,262
|
|
|
|
9,214
|
|
|
(Loss) from operations before equity in earnings of unconsolidated
joint ventures
|
|
|
(1,765
|
)
|
|
|
(3,300
|
)
|
|
|
(4,363
|
)
|
|
|
(3,230
|
)
|
|
Equity in earnings of unconsolidated joint ventures, net
|
|
|
2,353
|
|
|
|
2,055
|
|
|
|
5,650
|
|
|
|
4,861
|
|
|
Income (loss) before income tax expense
|
|
|
588
|
|
|
|
(1,245
|
)
|
|
|
1,287
|
|
|
|
1,631
|
|
|
Income tax expense (benefit)
|
|
|
271
|
|
|
|
(434
|
)
|
|
|
503
|
|
|
|
464
|
|
|
Net income (loss)
|
|
|
317
|
|
|
|
(811
|
)
|
|
|
784
|
|
|
|
1,167
|
|
|
Net loss attributable to non-controlling interest
|
|
|
(7
|
)
|
|
|
(23
|
)
|
|
|
(61
|
)
|
|
|
(68
|
)
|
|
Net income (loss) attributable to common stockholders
|
|
$
|
324
|
|
|
$
|
(788
|
)
|
|
$
|
845
|
|
|
$
|
1,235
|
|
|
Net income (loss) per share attributable to common stockholders,
basic
|
|
$
|
0.02
|
|
|
$
|
(0.04
|
)
|
|
$
|
0.04
|
|
|
$
|
0.06
|
|
|
Net income (loss) per share attributable to common stockholders,
diluted
|
|
$
|
0.02
|
|
|
$
|
(0.04
|
)
|
|
$
|
0.04
|
|
|
$
|
0.06
|
|
|
Weighted average number of shares outstanding:
|
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
20,732,767
|
|
|
|
20,669,348
|
|
|
|
20,719,900
|
|
|
|
20,658,750
|
|
|
Common stock equivalents – stock options
|
|
|
128,334
|
|
|
|
79,544
|
|
|
|
125,940
|
|
|
|
70,969
|
|
|
Diluted shares outstanding
|
|
|
20,861,101
|
|
|
|
20,748,892
|
|
|
|
20,845,840
|
|
|
|
20,729,719
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20161107006443/en/
Source: Tejon Ranch Co.
Tejon Ranch Co.
Allen Lyda, 661-248-3000
Executive Vice
President & Chief Financial Officer
|
View printer-friendly version