UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
__X__ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For nine months ended May 31, 2001.
OR
_____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____________________ to ____________________.
Commission file number 0-261.
ALICO, INC.
(Exact name of registrant as specified in its charter)
Florida 59-0906081
(State or other jurisdiction of (I.R.S. Employer
incorporation of organization) Identification No.)
P. O. Box 338, La Belle, FL 33975
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 863/675-2966
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
There were 7,044,513 shares of common stock, par value $1.00 per share,
outstanding at July 16, 2001.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ALICO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited - See Accountants' Review Report)
Three Months Ended Nine Months Ended
May 31, 2001 May 31, 2000 May 31, 2001 May 31, 2000
_____________ _____________ _____________ _____________
Revenue:
Citrus $12,658,475 $10,117,724 $ 24,175,466 $ 20,990,151
Sugarcane 2,697,707 2,310,378 11,939,228 8,782,558
Ranch 2,156,471 1,668,378 7,907,715 5,237,642
Rock products
and sand 447,055 307,176 1,280,913 989,448
Oil lease and
land rentals 298,838 187,081 671,438 794,093
Forest products 7,700 9,534 35,983 54,950
Profit on sales of real
estate 514,948 2,157 1,735,671 12,994,011
Interest and
investment income 214,852 912,231 946,433 3,247,684
Other 49,067 12,571 190,923 23,026
___________ ___________ ____________ ____________
Total revenue 19,045,113 15,527,230 48,883,770 53,113,563
___________ ___________ ____________ ____________
Cost and expenses:
Citrus production,
harvesting and
marketing 9,396,475 8,818,103 19,656,578 18,420,679
Sugarcane production
and harvesting 2,031,410 1,033,629 9,324,038 6,908,815
Ranch 1,445,549 1,427,821 6,679,233 4,851,294
Real estate expenses 84,171 151,954 266,522 439,772
Interest 647,342 662,924 2,356,042 2,072,480
Other, general and
administrative 1,043,296 898,722 3,089,703 2,220,551
___________ ___________ ____________ ____________
Total costs and
expenses 14,648,243 12,993,153 41,372,116 34,913,591
___________ ___________ ____________ ____________
Income before
income taxes 4,396,870 2,534,077 7,511,654 18,199,972
Provision for
income taxes 1,425,128 1,064,258 2,444,302 6,866,197
___________ ___________ ____________ ____________
Net income 2,971,742 1,469,819 5,067,352 11,333,775
___________ ___________ ____________ ____________
___________ ___________ ____________ ____________
Weighted average number of shares
outstanding 7,031,585 7,027,827 7,029,023 7,027,827
___________ ___________ ____________ ____________
___________ ___________ ____________ ____________
Per share amounts:
Basic and diluted $ .42 $ .21 $ .72 $ 1.61
Dividends $ - $ - $ 1.00 $ .30
See accompanying Notes to Condensed Consolidated Financial Statements.
ALICO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(See Accountants' Review Report)
May 31, 2001 August 31, 2000
___(Unaudited)___________________
ASSETS
Current assets:
Cash and cash investments $ 2,502,156 $ 1,796,428
Marketable securities 19,160,246 18,055,099
Accounts receivable 12,717,078 11,954,721
Mortgage and notes receivable 2,544,976 2,509,034
Inventories 17,248,119 21,915,039
Other current assets 293,744 348,062
____________ ____________
Total current assets 54,466,319 56,578,383
Notes receivable, non-current 7,545,097 7,334,579
Land held for development and sale 7,739,661 7,147,937
Investments 1,163,827 959,252
Property, buildings and equipment 138,480,258 136,822,381
Less: Accumulated depreciation (34,376,433) (31,966,492)
____________ ____________
Total assets $175,018,729 $176,876,040
____________ ____________
____________ ____________
ALICO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(See Accountants' Review Report)
(Continued)
May 31, 2001 August 31, 2000
LIABILITIES ___(Unaudited)_____________________
Current liabilities:
Accounts payable $ 1,306,198 $ 2,429,242
Due to profit sharing plan 0 429,784
Accrued ad valorem taxes 930,470 1,780,807
Current portion of notes payable 1,298,890 1,298,890
Accrued expenses 814,191 988,011
Income taxes payable 1,093,195 4,169,517
Deferred income taxes 1,672,411 1,250,026
____________ ____________
Total current liabilities 7,115,355 12,346,277
Deferred revenue 9,622,861 9,540,000
Notes payable 45,336,099 40,302,855
Deferred income taxes 10,512,747 10,889,095
Deferred retirement benefits 433,527 252,809
____________ ____________
Total liabilities 73,020,589 73,331,036
____________ ____________
STOCKHOLDERS' EQUITY
Common stock $ 7,041,865 $ 7,027,827
Additional paid in capital 295,551 17,885
Accumulated other comprehensive income 1,281,352 1,159,445
Retained earnings 93,379,372 95,339,847
____________ ____________
Total stockholders' equity 101,998,140 103,545,004
____________ ____________
Total liabilities and
stockholders' equity $175,018,729 $176,876,040
____________ ____________
____________ ____________
See accompanying Notes to Condensed Consolidated Financial Statements.
ALICO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(See Accountants' Review Report)
Accumulated
Common Stock Other
Compre- Additional
Shares Retained hensive Paid in
Issued Amount Earnings Income Capital Total
_________ __________ ___________ _______ _______ ___________
Balances,
August 31, 1999 7,027,827 $7,027,827 $83,337,579 $1,029,953 $- $91,395,359
_______________
Comprehensive income:
Net income for
the year ended
August 31, 2000 - - 14,110,616 - - 14,110,616
Unrealized gains on
securities, net of
taxes and
reclassification
adjustment - - - 129,492 - 129,492
____________
Total comprehensive
income 14,240,108
Dividends paid - - (2,108,348) - - (2,108,348)
Stock options
exercised - - - - - -
Stock based
compensation - - - - 17,88 17,885
_________ __________ ___________ ________ _______ _________
Balances,
August 31,2000 7,027,827 $7,027,827 $95,339,847 $1,159,445$17,885$103,545,004
_______________
Comprehensive income:
Net income for
the nine months ended
May 31, 2001 - - 5,067,352 - - 5,067,352
Unrealized gains on
securities, net
of taxes and
reclassification
adjustment - - - 121,907 - 121,907
___________
Total comprehensive
income 5,189,259
Dividends paid - - (7,027,827) - - (7,027,827)
Stock options
exercised 14,038 14,038 - - 191,198 205,236
Stock based
compensation - - - - 86,468 86,468
________ _______ ___________ ______ _______ _________
Balances,
May 31, 2001
(Unaudited) 7,041,865 $7,041,865 $93,379,372 $1,281,352 $295,551$101,998,140
_________ __________ ___________ ________ ________ ___________
_________ __________ ___________ ________ ________ ___________
May 31, August 31,
2001 2000
Disclosure of reclassification amount: _(Unaudited)_ __________
Unrealized holding gains (losses)
arising during the period $(389,118) $2,176,940
Less: reclassification adjustment
for gains (losses) included in net
income (511,025) 2,047,448
_________ __________
Net unrealized gains on securities $ 121,907 $ 129,492
_________ __________
_________ __________
See accompanying Notes to Condensed Consolidated Financial Statements.
ALICO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited - See Accountants' Review Report)
Nine Months Ended May 31,
2001 2000
____________________________
Cash flows from operating activities:
Net income $ 5,067,352 $11,333,775
Adjustments to reconcile net income to cash
provided from (used for) operating activities:
Depreciation and amortization 5,224,329 4,234,341
Net decrease in current assets and
liabilities (2,284,912) (2,409,233)
Deferred income taxes (27,516) 4,222,175
Gain on sales of real estate (1,735,671) (12,994,011)
Other 367,484 (278,111)
__________ __________
Net cash provided from
operating activities 6,611,066 4,108,936
__________ __________
Cash flows from (used for) investing activities:
Purchases of property and equipment (6,277,820) (8,047,504)
Proceeds from sales of real estate 2,606,304 4,199,731
Proceeds from sales of property and equipment 901,190 310,962
Purchases of marketable securities (2,525,341) (1,169,509)
Proceeds from sales of marketable securities 1,631,371 1,562,188
__________ __________
Net cash used for
investing activities (3,664,296) (3,144,132)
__________ __________
Cash flows from (used for) financing activities:
Net (issuance of) collection on
notes receivable (246,459) 530
Repayment of bank loan (30,980,583) (21,183,391)
Proceeds from bank loan 36,013,827 23,214,391
Dividends paid (7,027,827) (2,108,348)
__________ __________
Net cash used for
financing activities (2,241,042) (76,818)
__________ __________
Net increase in cash and
cash investments 705,728 887,986
Cash at beginning of period 1,796,428 740,829
__________ __________
Cash at end of period $ 2,502,156 $ 1,628,815
__________ __________
__________ __________
Supplemental disclosures of cash flow information:
Cash paid for interest, net of
amount capitalized $2,575,648 $2,373,057
__________ __________
__________ __________
Cash paid for income taxes $5,548,139 $1,250,229
__________ __________
__________ __________
Non-cash investing and financing activities:
Mortgage and notes receivable issued in
exchange for land, less unamortized
discount $ 64,000 $11,625,807
___________ __________
___________ __________
Fair value adjustments to securities
available for sale $ 195,458 $ (780,196)
__________ __________
__________ __________
Income tax effect related to fair
value adjustment $ (73,551) $ (293,241)
__________ __________
__________ __________
See accompanying Notes to Condensed Consolidated Financial Statements.
ALICO, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(See Accountants' Review Report)
1. Basis of financial statement presentation:
The accompanying condensed consolidated financial statements include the
accounts of Alico, Inc. and its wholly owned subsidiaries, Saddlebag Lake
Resorts, Inc. (Saddlebag) and Agri-Insurance Company, Ltd. (Agri),
after elimination of all significant inter-company balances and transactions.
The accompanying unaudited condensed consolidated financial statements have
been prepared on a basis consistent with the accounting principles and
policies reflected in the Company's annual report for the year ended August 31,
2000. In the opinion of Management, the accompanying unaudited condensed
consolidated financial statements contain all adjustments (consisting only of
normal recurring accruals) necessary for a fair presentation of its
consolidated financial position at May 31, 2001 and August 31, 2000 and the
consolidated results of operations and cash flows for the nine months
ended May 31, 2001 and 2000.
The basic business of the Company is agriculture, which is of a seasonal
nature and subject to the influence of natural phenomena and wide price
fluctuations. Fluctuation in the market prices for citrus fruit has caused
the Company to recognize additional revenue from the prior year's crop
totaling $617,086 in 2001 and $1,839,642 in 2000. The results of operations
for the stated periods are not necessarily indicative of results to be
expected for the full year.
2. Real Estate:
Real Estate sales are recorded under the accrual method of accounting.
Under this method, a sale is not recognized until payment is received,
including interest, aggregating 10% of the contract sales price for
residential properties and 20% for commercial properties.
3. Mortgage and notes receivable:
Mortgage and notes receivable arose from real estate sales. The balances
at May 31, 2001 and August 31, 2000 are as follows:
May 31, August 31,
2001 2000
____________ __________
Mortgage notes receivable
on retail land sales $ 230,073 $ 238,417
Mortgage notes receivable
on bulk land sales 9,540,000 9,540,000
Other notes receivable 320,000 65,196
____________ __________
Total mortgage notes receivable $ 10,090,073 $ 9,843,613
Less current portion 2,544,976 2,509,034
____________ __________
Non-current portion $ 7,545,097 $7,334,579
____________ __________
____________ __________
In July 2000, the Company received a mortgage note in exchange for land sold.
The note totaled $9,540,000 and principal payments of $2,385,000 are due
annually on July 14, bearing interest at the LIBOR, over the next four years.
In connection with the sale, the Company received 10% of the sales price at
closing. Consequently, the Company has deferred recognition of the revenue
associated with the mortgage until 20%, including interest, is received.
4. Inventories:
A summary of the Company's inventories is shown below:
May 31, August 31,
2001 2000
____________ ___________
Unharvested fruit crop on trees $ 7,515,006 $ 9,160,234
Unharvested sugarcane 2,776,832 5,095,514
Beef cattle 6,740,401 7,469,897
Sod 215,880 189,394
____________ ___________
Total inventories $ 17,248,119 $21,915,039
____________ ___________
____________ ___________
Subject to prevailing market conditions, the Company may hedge a portion of
its beef inventory by entering into cattle futures contracts to reduce
exposure to changes in market prices. Any gains or losses anticipated under
these agreements were deferred, with the cost of the related cattle being
adjusted when the contracts are settled. As discussed in the Company's
first quarter 10-Q, effective September 1, 2000, gains and losses under these
agreements are recognized as incurred. The Company recorded losses under
these agreements for the nine months ended May 31, 2001 totaling $1,929.
5. Income taxes:
The provision for income taxes for the quarters and nine months ended May 31,
2001 and May 31, 2000 is summarized as follows:
Three Months Ended Nine Months Ended
May 31, 2001 May 31, 2000 May 31, 2001 May 31, 2000
_____________ _____________ ______________ ____________
Current:
Federal income tax $ 705,690 $480,493 $2,101,045 $2,310,341
State income tax 118,429 73,115 370,773 333,681
_____________ _____________ _____________ ____________
824,119 553,608 2,471,818 2,644,022
_____________ _____________ _____________ ____________
Deferred:
Federal income tax 508,397 449,770 (27,149) 3,604,566
State income tax 92,612 60,880 (367) 617,609
_____________ _____________ _____________ ____________
601,009 510,650 (27,516) 4,222,175
_____________ _____________ _____________ ____________
Total provision for
income taxes $1,425,128 $1,064,258 $2,444,302 $6,866,197
_____________ _____________ _____________ ____________
_____________ _____________ _____________ ____________
Following is a reconciliation of the expected income tax expense computed at
the U.S. Federal statutory rate of 34% and the actual income tax provision for
the quarters and nine months ended May 31, 2001 and May 31, 2000:
Three Months Ended Nine Months Ended
May 31, 2001 May 31, 2000 May 31, 2001 May 31, 2000
_____________ _____________ ____________ _____________
Expected income tax $ 1,330,841 $ 861,586 $ 2,389,868 $ 6,187,990
Increase (decrease)
resulting from:
State income taxes, net
of federal benefit 145,633 51,516 249,387 590,931
Nontaxable interest and
dividends (58,365) (63,031) (122,391) (120,819)
Tax exempt income from
Agri-Insurance Co, Ltd (51,543) -0- (185,128) -0-
IRS audit adjustments -0- 188,964 -0- 188,964
Other reconciling items,
net 58,562 25,223 112,566 19,131
_____________ ____________ ____________ ___________
Total provision for
income taxes $1,425,128 $ 1,064,258 $ 2,444,302 $ 6,866,197
_____________ ____________ ____________ ____________
_____________ ____________ ____________ ____________
6. Indebtedness:
The Company has financing agreements with commercial banks that permit the
Company to borrow up to $44 million. The financing agreements allow the
Company to borrow up to $41 million, which is due in 2002 and up to $3 million
which is due on demand. In March 1999, the Company mortgaged 7,680 acres for
$19 million in connection with a $22.5 million acquisition of producing citrus
and sugarcane operations. The total amount of long-term debt under these
agreements at May 31, 2001 and August 31, 2000 was $45,336,099 and $40,302,855,
respectively.
Maturities of the indebtedness of the Company over the next five years are as
follows: 2001- $1,298,890; 2002- $31,349,973; 2003- $1,303,559;
2004- $1,306,142; 2005- $1,308,905; thereafter $10,067,520.
Interest cost expensed and capitalized during the nine months ended
May 31, 2001 and May 31, 2000 was as follows:
2001 2000
________ ________
Interest expensed $2,356,042 $2,072,480
Interest capitalized 138,959 361,933
________ ________
Total interest cost incurred $2,495,001 $2,434,413
________ ________
________ ________
7. Dividends:
On October 3, 2000 the Company declared a year-end dividend of $1.00 per
share, which was paid on October 27, 2000.
8. Disclosures about reportable segments:
Alico, Inc. has four reportable segments: citrus, sugarcane, ranching and
general corporate. The commodities produced by these segments are sold to
wholesalers and processors who prepare the products for consumption. The
Company's operations are located in Florida.
The accounting policies of the segments are the same as those described in
the summary of significant accounting policies. Alico, Inc. evaluates
performance based on profit or loss from operations before income taxes.
Alico, Inc.'s reportable segments are strategic business units that offer
different products. They are managed separately because each segment
requires different management techniques, knowledge and skills.
The following table presents information for each of the Company's operating
segments as of and for the nine months ended May 31, 2001:
____________________________________________________________
General Consolidated
Citrus Sugarcane Ranch Corporate* Total
____________________________________________________________
Revenue $ 24,175,466 11,939,228 7,907,715 4,861,361 48,883,770
Costs and
expenses 19,656,578 9,324,038 6,679,233 5,712,267 41,372,116
Depreciation and
amortization 1,847,958 1,929,626 1,067,935 378,810 5,224,329
Segment profit 4,518,888 2,615,190 1,228,482 (850,906) 7,511,654
Segment assets 54,025,358 52,274,626 19,743,567 48,948,178 175,018,729
The following table presents information for each of the Company's operating
segments as of and for the nine months ended May 31, 2000:
____________________________________________________________
General Consolidated
Citrus Sugarcane Ranch Corporate* Total
____________________________________________________________
Revenue $ 20,990,151 8,782,558 5,237,642 18,103,212 53,113,563
Costs and
expenses 18,420,679 6,908,815 4,851,294 4,732,803 34,913,591
Depreciation and
amortization 1,809,726 1,580,531 453,128 390,956 4,234,341
Segment profit 2,569,472 1,873,743 386,348 13,370,409 18,199,972
Segment assets 56,189,604 50,481,751 20,765,904 42,885,584 170,322,843
*Consists of rents, investments, real estate activities and other such
items of a general corporate nature.
9. Stock Option Plan
On November 3, 1998, the Company adopted the Alico, Inc., Incentive Equity
Plan (The Plan) pursuant to which the Board of Directors of the Company may
grant options, stock appreciation rights, and/or restricted stock to certain
directors and employees. The Plan authorizes grants of shares or options to
purchase up to 650,000 shares of authorized but unissued common stock. Stock
options granted have vesting schedules which are at the discretion of the
Board of Directors and determined on the effective date of the grant.
Weighted
Weighted average
average remaining
exercise contractual
Shares price Life (in years)
_______ _________ _______________
Balance outstanding,
August 31, 2000 49,692 14.62 10
_______________
Granted 51,074 14.62 _______________
Exercised 14,038 14.62
_______ _________
Balance outstanding,
May 31, 2001 86,728 14.62
_______ _________
_______ _________
On May 31, 2001, 14,038 shares have been exercised. There were 35,654 shares
exercisable and 549,234 shares available for grant.
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
LIQUIDITY AND CAPITAL RESOURCES:
Working capital increased to $47,350,964 at May 31, 2001, up from
$44,232,106 at August 31, 2000. As of May 31, 2001, the Company had cash and
cash investments of $2,502,156 compared to $1,796,428 at August 31, 2000.
Marketable securities increased from $18,055,099 to $19,160,246 during the same
period. The ratio of current assets to current liabilities increased to 7.66 to
1 at May 31, 2001 from 4.58 to 1 at August 31, 2000. Total assets decreased
to $175,018,729 at May 31, 2001, compared to $176,876,040 at August 31,
2000.
In connection with financing agreements with commercial banks (See Note 6 under
Notes to Condensed Consolidated Financial Statements), the Company has an unused
availability of funds of approximately $12.7 million at May 31, 2001.
RESULTS OF OPERATIONS:
The basic business of the Company is agriculture, which is of a seasonal nature
and subject to the influence of natural phenomena and wide price fluctuations.
The results of operations for the stated periods are not necessarily indicative
of results to be expected for the full year.
Net income for the nine months ending May 31, 2001 decreased by $6,266,423
when compared to the same period a year ago. ($5,067,352 vs. $11,333,775
for the nine months ended May 31, 2001 and May 31, 2000, respectively). Net
income increased during the three months ended May 31, 2001, compared to
the same period a year ago ($2,971,742 vs. $1,469,819).
Income before income taxes decreased $10,688,318 for the nine months ended
May 31, 2001, when compared to the same period a year ago. This was
primarily due to the decrease in earnings from real estate activities
($1,735,671 for the nine months ended May 31, 2001 compared to $12,994,011
for the nine months ended May 31, 2000).
Earnings from agricultural activities increased from the prior year
($4,639,219 vs. $2,816,927 for the third quarter, and $8,362,560 vs.
$4,829,563 during the first nine months of fiscal 2001 and 2000, respectively).
Citrus
______
Citrus earnings increased for both the third quarter ($3,262,000 during fiscal
2001 vs. $1,299,621 during fiscal 2000) and the nine months ended May 31,
2001, when compared to the prior year ($4,518,888 for 2001 vs. $2,569,472
for 2000). Overall, market prices have increased when compared to the
prior year. Additionally, increased yields and a decrease in overall
production costs have combined to generate the earnings improvement.
Sugarcane
_________
Sugarcane earnings decreased for the third quarter ($666,297 for
fiscal 2001 vs. $1,276,749 for fiscal 2000) but increased for the
nine months ended May 31, 2001 ($2,615,190 vs. $1,873,743 for the
nine months ended May 31, 2000) Producing acres have increased and,
as a result, more acres are being harvested. The increased yields
and market prices are the primary factors in the year to date rise
in earnings.
Ranching
________
Ranch earnings increased for the third quarter ($710,922 vs. $240,557
for May 31, 2001 and May 31, 2000, respectively) and for the nine months
ended May 31, 2001 ($1,228,482 vs. $386,348 for 2001 and 2000,
respectively). Increased production and improved market prices for beef
are the primary cause of the improvement.
General Corporate
_________________
The Company is continuing its marketing and permitting activities for its
land which surrounds the Florida Gulf Coast University site.
The Company announced the formation of Agri-Insurance Company, Ltd.
(Agri) a wholly owned subsidiary, during July of 2000. The insurance
company has been capitalized by transferring cash and approximately
6,000 acres of the Lee County property along with the sales contracts,
referred to below. General and administrative expenses increased $725
thousand, primarily due to the formation of Agri. Through Agri, the
Company expects to be able to underwrite previously uninsurable risk
related to catastrophic crop and other losses. Additionally, the insurance
company will have access to reinsurance markets, otherwise inaccessible.
While Agri has underwritten a modest amount of coverage (approximately
$3.2 million) during August and December of 2000, it is expected that
more significant coverages will be written before the end of 2001.
In December of 1999, the Company entered into a contract to sell
approximately 2,500 acres for $50 million to Naples/Dallas Venture,
Inc. The agreement called for closings to occur on 250 acres per year
for 10 years. In January 2001, a third party contracted with the Company
to purchase approximately 2000 additional acres. The purchaser
has assumed the Naples/Dallas contract, combining the two parcels for
a total purchase price of approximately $110 million. The new contract
calls for closings to occur on 450 acres per year for 10 years. The
first closing is expected during fiscal 2003.
During September of 1999, the Company completed a sale of 1,230 acres
of land surrounding the University site in Lee County for $16.5 million.
The contract called for 25 percent of the purchase price to be paid at
closing, with the balance of $12.3 million payable annually over the
next four years. In August of 2000, Agri sold another 488 acres to
the same buyer, also near the University, for $10.6 million. In
connection with the sale, they agreed to pay off the $12.3 million
mortgage related to the September 1999 sale and pay 10% of the contract
price for their second purchase at closing. The balance is payable over
the next four years. The first sale generated a pre-tax gain of $13.4
million. The gain related to the second sale has only been recognized
to the extent that 10% of the purchase price has been collected net of
closing costs ($959 thousand). The remainder of the gain and related
mortgage will be recognized upon receipt of 20% of the contract price.
This is expected to occur before the end of fiscal 2001 (see Note 3 to
Condensed Consolidated Financial Statements).
In July of 1999, the Company entered into a contract to sell up to 402
acres near the University to Thomas B. Garlick, a Trustee of Florida
Land Trust 996 for approximately $15.5 million. The contract was
subsequently renegotiated, as provided for in the original agreement, and
calls for the sale of 44 acres for $5 million.
Cautionary Statement
____________________
Readers should note, in particular, that this Form 10-Q contains forward-
looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), that involve
substantial risks and uncertainties. When used in this document, or in
the documents incorporated by reference herein, the words "anticipate",
"believe", "estimate", "may", "intend" and other words of similar meaning,
are likely to address the Company's growth strategy, financial results and/or
product development programs. Actual results, performance or achievements
could differ materially from those contemplated, expressed or implied by
the forward-looking statements contained herein. The considerations listed
herein represent certain important factors the Company believes could cause
such results to differ. These considerations are not intended to represent
a complete list of the general or specific risks that may effect the Company.
It should be recognized that other risks, including general economic factors
and expansion strategies, may be significant, presently or in the future,
and the risks set forth herein may affect the Company to a greater extent
than indicated.
ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
No changes
FORM 10-Q
PART II. OTHER INFORMATION
ITEM 6. Exhibits and reports on Form 8-K.
(a) Exhibits:
A. Accountant's Report.
B. Computation of Weighted Average Shares Outstanding at
May 31, 2001.
(b) Reports on Form 8-K.
November 3, 2000
December 7, 2000
December 14, 2000
December 18, 2000
December 21, 2000
March 7, 2001
March 23, 2001
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ALICO, INC.
(Registrant)
July 16, 2001 W. Bernard Lester
Date President
Chief Operating Officer
(Signature)
July 16, 2001 L. Craig Simmons
Date Vice President
Chief Financial Officer
(Signature)
July 16, 2001 Deirdre M. Purvis
Date Controller
(Signature)
EXHIBIT A
INDEPENDENT ACCOUNTANT'S REVIEW REPORT
______________________________________
The Stockholders and
Board of Directors
Alico, Inc.:
We have reviewed the condensed consolidated balance sheet of Alico, Inc.
and subsidiaries as of May 31, 2001, and the related condensed
consolidated statements of operations for the three-month and nine-month
periods ended May 31, 2001 and May 31, 2000, the condensed consolidated
statement of stockholders' equity for the nine-month period May 31, 2001,
and the condensed consolidated statements of cash flows for the nine-month
periods ended May 31, 2001 and May 31, 2000. These condensed consolidated
financial statements are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical review
procedures to financial data and making inquiries of persons responsible
for financial and accounting matters. It is substantially less in scope
than an audit conducted in accordance with generally accepted auditing
standards, the objective of which is the expression of an opinion regarding
the financial statements taken as a whole. Accordingly, we do not express
such an opinion.
Based on our reviews, we are not aware of any material modifications that
should be made to the condensed consolidated financial statements referred
to above for them to be in conformity with accounting principles generally
accepted in the United States of America.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of Alico, Inc. and subsidiaries as
of August 31, 2000 and the related consolidated statements of operations,
stockholders' equity and cash flows for the year then ended (not presented
herein); and in our report dated October 12, 2000 we expressed an
unqualified opinion on those consolidated financial statements. In our
opinion, the information set forth in the accompanying condensed
consolidated balance sheet as of August 31, 2000, is fairly presented,
in all material respects, in relation to the consolidated balance sheet
from which it has been derived.
s/s KPMG LLP
Orlando, Florida
June 29, 2001
FORM 10-Q
ALICO, INC.
Computation of Weighted Average Shares Outstanding as of May 31, 2001:
Number of shares outstanding at August 31, 2000 7,027,827
_________
_________
Number of shares outstanding at May 31, 2001 7,041,865
_________
_________
Weighted Average 9/1/00 - 05/31/01 7,029,023
_________
_________
EXHIBIT B