Alico(ALCO) - 2025 Q2 - Quarterly Report

Revenue and Losses - Total operating revenues for the three months ended March 31, 2025, were $17,980,000, a decrease of 0.7$18,113,000 for the same period in 2024[18] - Alico Citrus segment reported revenues of $17,253,000 for the three months ended March 31, 2025, down from$17,762,000 in the prior year, reflecting a decline of 2.9%[18] - Net loss attributable to Alico, Inc. common stockholders for the three months ended March 31, 2025, was $111,385,000, compared to a net loss of$15,804,000 for the same period in 2024[18] - For the six months ended March 31, 2025, Alico, Inc. reported a net loss of $120.684 million compared to a net income of$26.423 million for the same period in 2024[28] - The total gross loss profit for the six months ended March 31, 2025, was $157,935,000, compared to a gross loss of$32,413,000 for the same period in 2024[101] Assets and Liabilities - Total assets decreased to $243,165,000 as of March 31, 2025, down from$398,719,000 as of September 30, 2024[15] - Total liabilities decreased to $107,954,000 as of March 31, 2025, compared to$142,424,000 as of September 30, 2024[15] - The company had total assets of $243,165,000 as of March 31, 2025, down from$398,719,000 as of September 30, 2024, reflecting a decrease of 39.0%[100] Cash and Cash Equivalents - Cash and cash equivalents increased to $14,659,000 as of March 31, 2025, from$3,150,000 as of September 30, 2024[15] - Alico's cash and cash equivalents at the end of the period were $15.421 million, up from$5.966 million at the end of the same period in 2024[28] - The company had cash and cash equivalents of $14,659,000 as of March 31, 2025, compared to$3,150,000 on September 30, 2024[48] Dividends and Stock - The company declared cash dividends of $0.05 per common share for both the three and six months ended March 31, 2025[18] - The weighted-average number of common shares outstanding for the three months ended March 31, 2025, was 7,637,000, slightly up from 7,620,000 in the same period of 2024[18] - The weighted average common shares outstanding for diluted earnings per share remained stable at 7,637,000 for the three months ended March 31, 2025, compared to 7,620,000 in 2024[52] Strategic Changes - Alico plans to focus on long-term diversified land usage and real estate development strategy, winding down citrus production operations[12] - The company plans to wind down its Alico Citrus division due to financial challenges, with a workforce reduction of up to 172 employees approved by the Board[30] Impairments and Adjustments - The company reported a significant impairment of long-lived assets amounting to$24.966 million during the six months ended March 31, 2025[28] - The company recognized an impairment of long-lived assets totaling $24,966,000 for the three and six months ended March 31, 2025, due to reduced cash flow estimates[56] - The company recognized an impairment of$24,966,000 related to its young trees and long-lived assets due to the Strategic Transformation[75] Inventory and Receivables - Accounts receivable related to citrus sales as of March 31, 2025, amounted to $9,145,000, significantly higher than$444,000 recorded on September 30, 2024[43] - The company recorded inventory adjustments of $9,895,000 and$28,549,000 for the six months ended March 31, 2025 and 2024, respectively, primarily due to lower than anticipated harvests caused by Hurricane Milton[67] - As of March 31, 2025, total inventories decreased to $7,247,000 from$30,084,000 as of September 30, 2024[66] Debt and Financial Compliance - The company’s long-term debt as of March 31, 2025, was $88,536,000, with an estimated fair value of$83,713,000[49] - Long-term debt as of March 31, 2025, was $81,654,000, a slight decrease from$82,313,000 as of September 30, 2024[83] - The company was in compliance with all financial covenants as of March 31, 2025, including a minimum debt service coverage ratio of 1.10 to 1.00[91] Stock Options and Compensation - As of March 31, 2025, the company has 38,000 stock options vested and outstanding with a weighted average exercise price of $33.75 and a remaining contractual term of 1.8 years[112] - The company granted market-based restricted stock units (MRSUs) on December 23, 2024, with thresholds set at$35, $40, and$45 per share, allowing for the potential earning of up to 38,000 MRSUs[113] - Total unrecognized stock compensation costs for MRSUs as of March 31, 2025, amount to $422,000, compared to$0 as of September 30, 2024[115] Other Financial Metrics - The effective tax rate for the three months ended March 31, 2025, was a benefit of 19.4%, differing from the Federal Statutory rate of 21.0% primarily due to a change in the valuation allowance[96] - The Amended RLOC had a variable interest rate of 6.53% as of March 31, 2025, compared to 7.30% as of September 30, 2024[90] - The company has a minimum current ratio requirement of 1.50 to 1.00, which it maintained as of March 31, 2025[91] Legal and Compliance - There are no current legal proceedings that the company believes will have a material adverse effect on its financial condition[116]