TEJON RANCH, Calif.--(BUSINESS WIRE)--Mar. 17, 2014--
Tejon Ranch Co. (NYSE:TRC) today released the results of operations for
the year ended December 31, 2013, with the Company showing net income
attributable to common stockholders of $4,165,000, or $0.21 per common
share, compared to net income attributable to common stockholders of
$4,441,000, or $0.22 per common share, for the same period in 2012.
Total revenue, including investment and other income, for the year ended
December 31, 2013 was $46,345,000, compared to $48,444,000 of total
revenue for the same period during 2012. All per share references in
this release are presented on a fully diluted basis.
For the fourth quarter of 2013, the Company had net losses attributable
to common stockholders of $826,000, or ($0.04) per common share,
compared to net income attributable to common stockholders of $27,000,
or $0.00 per common share during the fourth quarter of 2012. Total
revenue for the fourth quarter of 2013, including investment income and
other income, was $13,216,000, compared to $13,904,000 of revenue during
the same period of 2012.
“Overall, the Company’s performance for 2013 was comparable to 2012.
2013 was also a year we saw the diversity in our revenue sources come
into play. Our mineral resource revenue declined in 2013, but the
decline was offset by improved commercial/industrial revenue including
growth from our joint ventures,” said Gregory S. Bielli, president and
CEO. “In 2014 we will continue to advance our various real estate
projects with a particular focus on completing and opening The Outlets
at Tejon, which is scheduled to open in late summer. Undoubtedly, water
is a very important and valuable commodity in California. Many
operations around the state may have difficulty in securing all the
water they need in 2014, but due to our previous investments in water
and water infrastructure, we will have the necessary water resources to
continue forward with our real estate and farming activities during this
year and beyond.”
Results of Operations for the Year Ended December 31, 2013:
Net income attributable to common stockholders declined slightly when
compared to the same period of 2012 as did total revenues. However, the
mix in revenues changed from year-to-year with 2013 showing a healthy
increase in earnings from unconsolidated joint ventures.
Commercial/industrial revenue improved $1,207,000 during 2013 due to an
increase in hunting permit revenues resulting from the re-opening of the
hunting program during the third quarter of 2012, and to higher
percentage rents of $551,000 from our power plant lease. These
improvements were partially offset by a decrease in land sale revenue
tied to a deferred gain recognized during 2012.
Mineral resource revenue declined $3,770,000 in 2013 compared to 2012.
The decline was the result of a drop in oil royalty revenue of
$3,401,000 and lower lease hold payments. The drop in oil royalty
revenue came as lease holders closed some wells for maintenance and
invested in the expansion of on-site production facilities, as well as
regulatory permitting delays, which reduced the number of new wells
drilled during 2013. On the positive side, revenues from our rock and
aggregate operations and the National Cement lease improved in 2013 as
construction activity began to improve in the area.
Farming revenues were flat compared to 2012 but there was a change in
primary revenue sources when compared to 2012. Almond revenues improved
$1,959,000 during 2013 primarily due to a 46% increase in the average
price received for almonds. This improvement in almond revenue was
offset by declines in pistachio revenue and wine grape revenue. These
declines were largely the result of reduced production due to a summer
wind storm, 2013 being the off-production year for pistachios, and fewer
vineyards in production due to redevelopment programs. The change noted
earlier is the decline in pistachio revenue and the growth in almond
revenue during 2013. During 2012, the largest improvement in farming
revenue was driven by pistachios.
Equity in earnings of unconsolidated joint ventures is an important
component of the Company’s real estate development activities. As we
expand our current ventures and add new ventures, such as the outlet
center joint venture, these investments will become a growing revenue
source for the Company. During 2013, equity in earnings of
unconsolidated joint ventures grew to $4,006,000, an increase of
$1,471,000 when compared to 2012. The increase was driven by improved
fuel sales, margins, and lower interest expense within the TA/Petro
joint venture.
Adding to the decline in total revenues in 2013 was a small overall
increase in costs and expenses of approximately $201,000. This increase
was driven by higher farming cost of sales and increase professional
service costs related to stock registration activities, the warrant
dividend and services provided for our real estate activities. These
increases were somewhat offset by reduced stock compensation expense
tied to the reversal of costs related to the departure of two executive
officers during 2013.
Results of Operations for the Fourth Quarter of 2013:
The decline in revenue during the fourth quarter of 2013, when compared
to the same period in 2012, is due to $593,000 in lower oil royalty
revenues as described above and to $375,000 in reduced farming revenues
due to the timing of sales of crops and to lower pistachio and wine
grape production. These variances were partially offset by improved
hunting permit revenue and lease revenue from our power plant lease as
previously described above.
The decrease in net income attributable to common stockholders during
the fourth quarter of 2013 is driven by the decline in revenues just
described, an increase in farming cost of sales, and to an increase in
corporate costs primarily related to professional service fees.
2014 Outlook:
Management believes the capital structure of the Company provides a
solid foundation for continued investment in our projects, which set the
stage for the future growth of the Company. On December 31, 2013, total
capital was approximately $325,000,000, with debt accounting for
approximately 1.5% of total capital. As of December 31, 2013, we also
had cash and securities totaling approximately $65,000,000 and
$30,000,000 of availability on lines of credit to meet any short-term
funding needs.
As noted above, 2014 will be a very difficult water year in California.
The State Water Project will be delivering a zero allocation of water
this year to all contract holders. The Company, however, has adequate
water for its needs for 2014. Over the last several years, the Company
has invested in water assets and water infrastructure and through those
investments we will be able to meet our real estate and farming needs.
During 2014, the Company will continue to aggressively pursue land
entitlement activities and investment within the Tejon Ranch Commerce
Center and in our joint ventures. The Company believes the variability
of its quarterly and annual operating results will continue during 2014
due to its farming and real estate activities. Prices received by the
Company for many of its products are dependent upon the prevailing
market conditions and commodity prices. Many of the Company’s projects,
especially in real estate, require a lengthy process to complete the
entitlement and development phases before revenue can begin to be
recognized. The timing of projects and sales of both real estate
inventory and non-strategic assets can vary from year-to-year;
therefore, it is difficult for the Company to accurately predict
quarterly and annual revenues and results of operations.
Tejon Ranch Co. 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 online at http://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, which could affect the Company, the
reader should refer to the Company’s filings with the Securities and
Exchange Commission.
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TEJON RANCH CO.
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YEAR-END EARNINGS RELEASE 2013
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(UNAUDITED, IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
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THREE MONTHS ENDED
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YEAR ENDED
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DECEMBER 31
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DECEMBER 31
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2013
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2012
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2013
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2012
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REVENUES:
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Real Estate - Commercial/Industrial
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$
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2,759
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$
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2,432
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$
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11,148
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$
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9,941
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Real Estate - Resort/Residential
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385
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316
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1,266
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583
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Mineral Resources
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2,187
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2,780
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10,242
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14,012
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Farming
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7,644
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8,019
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22,682
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22,553
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Revenues from Operations
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12,975
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13,547
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45,338
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47,089
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OPERATING PROFITS:
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Real Estate - Commercial/Industrial
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(599
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(845
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)
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(1,754
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)
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(2,330
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)
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Real Estate - Resort/Residential
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(588
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)
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(860
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)
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(2,085
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)
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(4,178
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)
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Mineral Resources
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2,102
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2,636
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9,780
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13,678
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Farming
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2,498
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2,920
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7,876
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9,230
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Income from Operating Segments
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3,413
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3,851
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13,817
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16,400
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Investment Income
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212
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294
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941
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1,242
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Other Income
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29
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63
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66
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113
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Corporate Expenses
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(5,239
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(3,835
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(12,641
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(13,272
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Interest Expense
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-
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(10
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-
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(12
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Income (loss) from Operations before Equity in Earnings of
Unconsolidated Joint Ventures
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(1,585
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)
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363
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2,183
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4,471
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Equity in Earnings of Unconsolidated Joint Ventures
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1,086
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887
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4,006
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2,535
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Income (loss) from Operations before Income Tax
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(499
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)
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1,250
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6,189
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7,006
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Income Tax Expense
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334
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1,262
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2,086
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2,723
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Net loss attributable to non-controlling interest
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(7
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(39
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(62
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)
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(158
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Net Income (loss) Attributable to Common Stockholders
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$
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(826
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$
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27
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$
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4,165
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$
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4,441
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Net Income (loss) Per Common Share, Basic
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$
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(0.04
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)
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$
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-
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$
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0.21
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$
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0.22
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Net Income (loss) Per Common Share, Diluted
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$
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(0.04
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)
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$
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-
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$
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0.20
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$
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0.22
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Source: Tejon Ranch Co.
Tejon Ranch Co.
Allen Lyda, 661-248-3000
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