UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): June 14, 2012

 

Alico, Inc.

(Exact name of registrant as specified in its charter)

 

Florida   0-261   59-0906081
(State or other jurisdiction   (Commission File Number)   (I.R.S. Employer Identification No.)
of incorporation)        

 

10070 Daniels Interstate Court Suite 100

Fort Myers, FL 33913

(Address of principal executive offices and zip code)

 

Registrant’s telephone number, including area code: (239) 226-2000

 

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

 

 

 
   

 

Section 7 Regulation FD
Item 7.01 Regulation FD Disclosure

 

Alico, Inc.’s (“Alico”) Executive Officers will deliver presentations to members of the financial community beginning in New York, New York in the coming weeks. The slides to be used at the meeting are furnished herewith as Exhibit 99.1 and are incorporated by reference into Item 7.01 of this Current Report on Form 8-K.

The information contained in this Item 7.01 is not “filed” for purposes of the Securities Exchange Act of 1934, as amended, and is not deemed incorporated by reference by any general statements incorporating by reference this report or future filings into any filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent Alico specifically incorporates the information by reference. By including this Item 7.01 disclosure in the filing of this Current Report on Form 8-K and furnishing this information, Alico makes no admission as to the materiality of any information in this report that is required to be disclosed solely by reason of Regulation FD.

 

Section 9 Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits

The following exhibits are furnished with this report on Form 8-K:

 

     

Exhibit

Number

 

Description

   
99.1   Alico, Inc. Investor Presentation

 

 

 

 

 

 

 

 
   

 

 

 

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 hereunto duly authorized.

 

Date: June 14, 2012 ALICO, INC.
       
  By:   /s/ W. Mark Humphrey
       
      W. Mark Humphrey
     

Senior Vice President and Chief Financial Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

Forward-Looking Statements

This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on Alico’s current expectations about future events and can be identified by terms such as “estimates,” “plans,” “expect,” “may,” “anticipate,” “intend,” “should be,” “will be,” “is likely to,” “strive to,” and similar expressions referring to future periods.

Alico believes the expectations reflected in the forward-looking statements are reasonable but cannot guarantee future results, level of activity, performance or achievements. Actual results may differ materially from those expressed or implied in the forward-looking statements. Therefore, Alico cautions you against relying on any of these forward-looking statements. Factors which may cause future outcomes to differ materially from those foreseen in forward-looking statements include, but are not limited to: changes in laws, regulations and rules; weather conditions that affect production, transportation, storage, import and export of fresh product; increased pressure from disease, insects and other pests; disruption of water supplies or changes in water allocations; pricing and supply of raw materials and products; market responses to industry volume pressures; pricing and supply of energy; changes in interest rates; availability of financing for land development activities; political changes and economic crises; international conflict; acts of terrorism; labor disruptions; inability to pay debt obligations; inability to engage in certain transactions due to restrictive covenants in debt instruments; government restrictions on land use; market and pricing risks due to concentrated ownership of stock. Other risks and uncertainties include those that are described in Alico’s SEC filings, which are available on the SEC’s website at http://www.sec.gov. Alico undertakes no obligation to subsequently update or revise the forward-looking statements made in this presentation, except as required by law.

2

Company Highlights

Agribusiness company with an emphasis on citrus
A leading citrus grower in Florida with 11,000 acres
Increasing yields
Decreasing unit production costs
Significant industry expertise
Favorable Florida citrus market outlook
Planned investment in additional citrus groves
Other land holdings presently used for:
Sugarcane
Cattle
Leasing and development
Debt to equity ratio of .42 and substantial availability under LOC
Strong growth in EPS


3

Quick Overview of Alico, Inc.

Formed in 1960 as a land management company operating in central and southwest Florida
Owns approximately 140,000 acres in five Florida counties
Agricultural lines of business include Citrus Groves, Citrus Supply Chain Management, Sugarcane and Cattle
Other operations include land leasing, rock and sand mining, mineral and oil leasing and real estate development
4

Company Revenue Cycles

Harvest Early/Mid Varieties of Oranges

Harvest Valencia Oranges

Harvest Sugarcane

Deliver Beef Cattle



5

Consolidated Financial Summary
Three Year Trend
(in millions, except per share data)

         
  Fiscal Years Ended September 30,      
  2009 2010 2011 CAGR
         
Operating Revenue $ 89.5   $ 79.8   $ 98.6     3.3 %
Operating Expense   87.7     69.9     75.2     -5.0 %
Gross Profit   1.8     9.9     23.4     133.6 %
                         
General and Administrative Expenses   9.1     6.5     8.2     -3.4 %
Operating Income   (7.3 )   3.5     15.2     228.0 %
                         
Interest and Investment Income (Loss), net   0.6     0.9     (1.4 )   -232.3 %
Interest Expense   (5.4 )   (6.9 )   (2.0 )   28.1 %
Other Income, Net   8.6     0.7     0.7     -57.0 %
Income Tax (Provision) Benefit   (0.2 )   1.2     (5.4 )   222.4 %
Net Income (Loss) $ (3.6 ) $ (0.6 ) $ 7.1     224.8 %
                         
EPS $ (0.49 ) $ (0.08 ) $ 0.96     225.1 %

6

Consolidated Financial Summary
First Half FY2012

(in millions, except per share data)

       
  Six Months Ended March 31,    
  2011 2012 % Change
       
Operating Revenue $ 53.0   $ 80.2     51 %
Operating Expense   42.5     60.4     42 %
Gross Profit   10.6     19.8     88 %
                   
General and Administrative Expenses   3.6     3.9     7 %
Operating Income   7.0     16.0     129 %
                   
Interest and Investment Income (Loss), net   (1.7 )   0.0     -102 %
Interest Expense   (1.1 )   (0.9 )   -13 %
Other Income, Net   0.1     0.0     -44 %
Income Tax (Provision) Benefit   (1.6 )   (5.7 )   258 %
Net Income (Loss) $ 2.6   $ 9.3     257 %
                   
EPS $ 0.36   $ 1.27     253 %

7

Citrus Market Overview


Total U.S. orange production – 206 million (i) boxes
Total Florida orange production – 146 million (i) boxes
Alico grows and harvests approximately 4.4 million boxes of oranges and 0.2 million boxes of grapefruit and other specialty fruit
Alico handles approximately 3.5 million boxes grown by others thru its supply chain management arm
Grows, harvests and handles ~5% of Florida production
Florida production expected to remain relatively flat over next 10 years
Florida shortfalls in production covered by imports from Brazil to meet demand
Opportunity for Alico to expand citrus operations
One of the top ten growers in Florida (ii)

(i) Source – USDA June 2012 Forecast
(ii) Source – Florida Grower Magazine

8

Industry Trends


Sources – Florida Agricultural Statistics Service, Allen Morris

9

Industry Trends


Sources – Florida Agricultural Statistics Service, Allen Morris

10

Alico’s Historical Citrus Returns


11

Alico’s Historical Citrus Returns


12

Leading Citrus Grower
Production Increases


Alico production increases over last two harvest seasons:
28% increase in boxes (i)
33% increase in Lbs Solid (i)
Florida production up 9.3% in boxes over the same time period (ii)
Outpaced Florida’s box increases due in large part to:
Expertise in foliar nutritional programs
Proficiency in farming methods

(i) Source – Internal Estimates for 2011/12 Crop Year
(ii) Source – USDA June 2012 Forecast


13

Leading Citrus Grower
Production Costs Per Box


Alico production costs per box:
18% (i) decrease in cost per box over last two harvest seasons
Lower production costs per box than Brazil average (ii)
Expect lower 2011/12 production costs per box than southwest Florida region average (iii)

(i) Source – Internal Estimates for 2011/12 Crop Year

(ii) GCONCI (2010/11 Estimates)

(iii) Source – University of Florida/IFAS (2010/11 Estimates)


14

Leading Citrus Grower
Significant Industry/Management Experience

JD Alexander, CEO – Over 30 years experience in Florida citrus
Dr. Ken Smith, COO – Over 23 years in agriculture
Daniel Sutton, Director of Citrus Operations – Over 18 years experience in Florida citrus
Chris Moore, President of Bowen Brothers – Over 20 years experience in Florida citrus
Mark Humphrey, CFO – Over 17 years experience in finance
15

Revenue and Gross Profit by Segment
Three Year Trend

(in millions)

         
  Fiscal Years Ended September 30,    
  2009 2010 2011 CAGR
         
Revenue:                        
Bowen (Citrus Supply Chain Management) $ 28.0   $ 28.9   $ 36.1     8.9 %
Citrus Groves   36.0     36.5     47.1     9.3 %
Sugarcane   7.6     4.1     7.8     0.7 %
Cattle   8.2     4.0     4.6     -17.5 %
Real Estate   1.4     -     -     -100.0 %
Land Leasing and Rental   2.7     2.4     2.4     -3.3 %
Land Sales and Other   5.6     3.9     0.5     -54.0 %
Total Revenue $ 89.5   $ 79.8   $ 98.6     3.3 %
                         
Gross Profit:                        
Bowen (Citrus Supply Chain Management) $ 1.3   $ 0.7   $ 1.0     -9.1 %
Citrus Groves   8.7     10.7     19.3     30.3 %
Sugarcane   (2.2 )   0.4     1.0     176.1 %
Cattle   (2.0 )   0.3     1.4     190.1 %
Real Estate   (3.9 )   (1.6 )   (0.6 )   46.8 %
Land Leasing and Rental   1.6     1.3     1.2     -8.3 %
Land Sales and Other   (1.8 )   (1.8 )   0.1     135.5 %
Total Gross Profit $ 1.8   $ 9.9   $ 23.4     133.6 %

16

Revenue and Gross Profit by Segment
First Half FY2012

(in millions)  

       
  Six Months Ended March 31,    
  2011 2012 %Change
       
Revenue:                  
Bowen (Citrus Supply Chain Management) $ 18.9   $ 30.8     62.8 %
Citrus Groves   24.6     33.5     36.0 %
Sugarcane   7.5     13.7     83.1 %
Cattle   0.4     0.6     33.6 %
Real Estate   -     -     NM  
Land Leasing and Rental   1.3     1.3     2.2 %
Land Sales and Other   0.3     0.3     12.9 %
Total Revenue $ 53.0   $ 80.2     51.2 %
                   
Gross Profit:                  
Bowen (Citrus Supply Chain Management) $ 0.6   $ 1.1     83.0 %
Citrus Groves   8.7     14.5     67.3 %
Sugarcane   0.6     3.1     398.9 %
Cattle   0.2     0.3     50.8 %
Real Estate   (0.3 )   (0.2 )   11.7 %
Land Leasing and Rental   0.7     0.8     19.1 %
Land Sales and Other   0.1     0.3     197.1 %
Total Gross Profit $ 10.6   $ 19.8     87.6 %

17

FY2012 Estimated Citrus Results

15% increase in production of early/mid varieties versus prior year
27% increase in production of Valencias versus prior year
Production increases due in large part to continually improving farming methods


18

FY2012 First Half Sugarcane and Cattle Results

Sugarcane
Revenue of $13.7MM versus $7.5MM last year
Gross profit of $3.1MM versus $0.6MM last year
Standard Tons harvested increased 52%
Cattle
Revenue of $0.6MM versus $0.4MM last year
Gross profit of $0.3MM
Approximately 752M pounds sold (691M pounds last year)
Price per pound increased 23%
19

Full Year FY2012 Estimate

           
  Fiscal Years Ended September 30,      
    2009     2010     2011     2012E   CAGR  
                               
Revenue $ 89.5   $ 98.6   $ 79.8   $ 125.8     8.9 %
                               
Gross Profit by Segment:                              
Bowen (Citrus Supply Chain Management)   1.3     0.7     1.0     1.2     -2.7 %
Citrus Groves   8.7     10.7     19.3     24.1     28.9 %
Sugarcane   (2.2 )   0.4     1.0     3.0     8.2 %
Cattle   (2.0 )   0.3     1.4     2.6     7.3 %
Real Estate   (3.9 )   (1.6 )   (0.6 )   (0.5 )   40.1 %
Land Leasing and Rental   1.6     1.3     1.2     1.3     -4.7 %
Land Sales   -     -     -     8.2     NM  
Other Operations   (1.8 )   (1.8 )   0.1     0.3     35.8 %
Total Gross Profit   1.8     9.9     23.4     40.2     116.3 %
                               
General and Administrative Expenses   9.1     6.5     8.2     8.5     -1.7 %
Operating Income   (7.3 )   3.5     15.2     31.7     44.6 %
                               
Interest and Investment Income (Loss), net   0.6     0.9     (1.4 )   -     -100.0 %
Interest Expense   (5.4 )   (6.9 )   (2.0 )   (1.7 )   -25.2 %
Other Income, Net   8.6     0.7     0.7     -     -100.0 %
Income Tax (Provision) Benefit   (0.2 )   1.2     (5.4 )   (11.6 )   190.6 %
Net Income (Loss) $ (3.6 ) $ (0.6 ) $ 7.1   $ 18.5     50.0 %
                               
EPS $ (0.49 ) $ (0.08 ) $ 0.96   $ 2.51     50.4 %

20

Alico’s Strategic Assessment

Citrus

Brands require Florida oranges
Tropicana and Minute Maid
Highest priced
Consumer preferred
Grown to over half the orange juice market
Marketers need to partner with Florida producers
Long-term marketing agreements
Volume and price incentives
Require stable and efficient growers
Growers bear all risks
Pricing
Weather/Diseases
Relatively high long-term expected returns

Sugarcane

Government supported industry
Most profitably grown on muck soils
Lower long-term expected returns

Cattle

Supply levels generally dictate pricing
Lower long-term expected returns

21

Strategic Vision and Initiatives

Market and sell under-productive assets
Invest in citrus groves to increase citrus production and partner with marketers
Plant groves on owned land
10,000 additional acres
Acquire groves in Florida
10,000 additional acres
           
Current Land Utilization:       Gross Acreage     Net Producing
Citrus Groves       15,000   10,700
Sugarcane       30,000   18,800
Developable Acreage (Lee County)       5,200   -
Improved Pasture       10,000   -
Unimproved Acreage and Other       79,400   -
  Total     139,600   29,500

22