Alico, Inc. Annual report pursuant to section 13 and 15(d)

Annual report pursuant to section 13 and 15(d)

Property, Buildings And Equipment

Property, Buildings And Equipment

12 Months Ended

Sep. 30, 2011

Property, Buildings And Equipment [Abstract]

Property, Buildings And Equipment

Note 7. Property, Buildings and Equipment, Net

Property, buildings and equipment consist of the following at September 30, 2011 and 2010:


	2011		2010
Breeding herd	$	10,799	$	10,924
Buildings		10,925		9,697
Citrus trees		35,939		34,359
Sugarcane		10,462		7,539
Equipment and other facilities		40,708		40,490

Total depreciable properties		108,833		103,009
Less accumulated depreciation and depletion		65,104		61,562

Net depreciable properties		43,729		41,447

Land and land improvements		85,051		83,526

Net property, buildings and equipment	$	128,780	$	124,973

Depreciation expense for property, buildings and equipment was $7.3 million, $7.2 million and $7.5 million for the year ended September 30, 2011, 2010 and 2009, respectively.

Due to the continuing depressed market prices of real estate in Florida, the Company evaluated several of its properties for impairment at September 30, 2011, 2010 and 2009. In conducting its evaluation, the Company reviewed the estimated non-discounted cash flows from each of the properties or obtained independent third party appraisals from a qualified real estate appraiser. Impairment charges of $1.0 million and $4.3 million were recorded in 2010 and 2009, respectively.

During fiscal 2009, due to the losses in the cattle division and increasing costs to raise cattle for breeding purposes, the Company evaluated its breeding herd for impairment using market observations and quotes for similar herds based on ages, condition and pregnancies. The Company recorded $813 thousand in impairment charges for its breeding herd in 2009. No impairment charges were recorded for the breeding herd during 2011 or 2010.

Alico-Agri foreclosed on a parcel of property in Lee County, Florida and took possession of the property in September 2010. Pursuant to the foreclosure, the net balance of the mortgage note, deferred revenue, accrued interest, tax certificates and the associated accrued commission payable totaling $6.6 million were reclassified as basis in the property.

The table below summarizes impairments recorded to fixed assets during the past three fiscal years:


	Polk County Property			Plant World Property			Breeding Herd
Acreage		290			50			N/A
Remaining adjusted carrying value at September 30, 2008	$	5,820		$	3,610		$	12,108
Less: Depreciation		—			(477	)		(371	)

Adjusted basis before impairments		5,820			3,133			11,737

Other (1)		—			—			(145	)

Impairments recognized during fiscal years ended:
September 30, 2009		(2,790	)		(1,460	)		(813	)
September 30, 2010		(980	)		—			—
September 30, 2011		—			—			—

Remaining adjusted carrying value at September 30, 2011	$	2,050		$	1,673		$	10,779

(1)	Includes additions, sales and deaths of the breeding herd from September 30, 2009 through September 30, 2011.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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