Q2 2025 Alico Inc Earnings Call

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Operator: Good morning and welcome to Alico's second quarter 2025 earnings call. Currently, all participants are in a listen-only mode. As a reminder, today's conference is being recorded.

Speaker Change: Good morning, and welcome to <unk> second quarter 2025 earnings call. Currently all participants are in a listen only mode. As a reminder, today's conference is being recorded.

John Mills: I would now like to turn the call over to your host, John Mills, Managing Partner at ICR. Good morning, everyone, and thank you for joining us for Alico's second quarter fiscal year 2025 conference call.

Speaker Change: I would now like to turn the call over to your host John Mills managing partner at ICR.

John Kiernan: Good morning, everyone. Thank you for joining us for <unk> second quarter fiscal year 2025 conference call on the call today are John John Kiernan, President and Chief Executive Officer, and Brad Heinie, Chief Financial Officer.

John Mills: On the call today are John Kiernan, President and Chief Executive Officer, and Brad Heine, Chief Financial Officer. By now, everyone should have access to the second quarter fiscal year 2025 earnings release, which went out yesterday at approximately 5 p.m. Eastern Time. If you've not had a chance to view the release, it's available on the Investor Relations portion of the company's website at alicoinc.com. This call is being webcast and a replay will be available on Alico's website as well.

John Kiernan: By now everyone should have access to the second quarter fiscal year 2025 earnings release, which went out yesterday at approximately <unk> PM Eastern time, if you've not had a chance to view the release, it's available on the Investor Relations portion of the company's website and a Lifeco Inc. Dot com.

John Kiernan: This call is being webcast and a replay will be available on our leakers website as well.

John Mills: Before we begin, we'd like to remind everyone that the prepared remarks contain forward-looking statements. Such statements are subject to risk, uncertainties, and other factors that may cause the actual results to differ materially from those expressed or implied in these statements. Important factors that could cause or contribute to such differences include risk and till in the company's quarterly report on Form 10-Q, annual reports on Form 10-K, current reports on Form 8-K, and any amendments thereto filed with the SEC and those mentioned in the earnings release. The company undertakes no obligation to subsequently update or revise the forward-looking statements made on today's call except as required by law.

John Kiernan: Before we begin we'd like to remind everyone that the prepared remarks contain forward looking statements such statements are subject to risks uncertainties and other factors that may cause the actual results to differ materially from those expressed or implied in these statements.

John Kiernan: Factors that could cause or contribute to such differences include risks detailed in the company's quarterly report on Form 10-Q annual reports on Form 10-K current reports on form 8-K, and any amendments thereto filed with the SEC and those mentioned in the earnings release.

John Kiernan: The company undertakes no obligation to subsequently update or revise the forward looking statements made on today's call except as required by law.

John Mills: During this call, the company may also discuss non-GAAP financial measures, including EBITDA, adjusted EBITDA, and net debt. For more details on these measures, please refer to the company's press release issued yesterday.

John Kiernan: During this call. The company May also discuss non-GAAP financial measures, including EBITDA adjusted EBITDA and net debt for more details on these measures. Please refer to the company's press release issued yesterday.

John Kiernan: And with that, it is my pleasure to turn the call over to the company's president and CEO, Mr. John Kiernan. Thank you, John. Good morning, everyone, and thank you for joining us for Alico's second quarter of fiscal year 2025 earnings call. I'd like to update you on the progress we've made in executing our strategic transformation since our announcement in January. At the end of April, we completed our fiscal year 2025 harvest. effectively concluding the majority of our capital investment in citrus operations. We will conduct a final harvest on the majority of the remaining 3,783 acres of operational citrus groves in fiscal year 2026.

Speaker Change: And with that it is my pleasure to turn the call on the company's President and CEO, Mr. John Kiernan.

John Kiernan: Thank you John.

John Kiernan: Everyone and thank you for joining us for a week or second quarter of fiscal year 2025 earnings call.

John Kiernan: I'd like to update you on our progress we've made we've made in executing our strategic transformation since our announcement in January.

John Kiernan: At the end of April we completed our fiscal year 2025 harvest.

John Kiernan: In fact, if we concluding the majority of our capital investment in citrus operations.

John Kiernan: We will conduct a final harvest on the majority of the remaining 3783 acres of operational citrus groves and fiscal year 2026.

John Kiernan: With this transition, we've reduced our workforce from approximately 200 to 25 employees, aligning our organizational structure with our transformed business model and significantly lowering operating expenses.

John Kiernan: With this transition we've reduced our work force from approximately 225 employees aligning our organizational structure with our transformed business model and significantly lowering operating expenses.

John Kiernan: on the land monetization front. We've completed the sale of 2,100 acres this year as part of our strategy to unlock the value of our substantial real estate portfolio. We previously announced our expectation to realize approximately $20 million in land sales this fiscal year based upon transactions that are under option agreements or have been negotiated and are expected to close this year.

On the land monetization front.

John Kiernan: If completed the sale of 2100 acres this year as part of our strategy to unlock the value of our substantial real estate portfolio.

John Kiernan: We previously announced our expectation to realize approximately $20 million in land sales this fiscal year.

John Kiernan: Based upon transactions that are under option agreements were had been negotiated and are expected to close this year.

John Kiernan: We are now raising our outlook to potentially have an additional $30 million of land sales or more this fiscal year, which would be a 150% increase from our prior guidance for fiscal year 2025 expected land sales. This acceleration in land sales could dramatically improve our annual adjusted EBITDA and strengthen our ability to return capital to shareholders.

John Kiernan: We are now raising our outlook the potential we have an additional $30 million of land sales or more this fiscal year, which would be a 150% increase from our prior guidance for fiscal year 2025 expected land sales.

John Kiernan: This acceleration in land sales could dramatically improve our annual adjusted EBITDA and strengthen our ability to return capital to shareholders.

John Kiernan: We've also been actively engaged with agricultural operators throughout Florida to diversify our remaining agricultural activities. These discussions have focused on potential sod production. expanding sand mining activities. and leases to grow seasonal crops such as corn, sugar cane, and a variety of fruits and vegetables. We've negotiated agreements to lease approximately 5,250 acres of different groves to third party citrus growers next season. We are also in discussions or under contract with other vegetable and fruit growers who are clearing as many as 1,000 acres for us this season in lieu of lease payments.

John Kiernan: We've also been actively engaged with agricultural operators throughout Florida to diversify our remaining agricultural activities.

John Kiernan: These discussions have focused on potential sop production.

John Kiernan: Expanding sand mining activities.

John Kiernan: Leases to grow seasonal crops, such as corn sugarcane in a variety of fruits and vegetables.

John Kiernan: We have negotiated agreements to lease approximately 5250 acres.

Speaker Change: Different grows to third party citrus growers next season.

Speaker Change: We are also in discussions are under contract with other vegetable and fruit growers, who.

Speaker Change: We're clearing as many as 1000 acres for us this season.

Speaker Change: Of lease payments.

John Kiernan: Our entitlement work for our identified near-term development properties is progressing under the guidance of Mitch Hutchcraft, our Executive Vice President of Land Management. Mitch brings nearly four decades of experience and entitlement work throughout Florida. His deep expertise in navigating the complex rezoning and land use approval processes in Florida is invaluable as we work to unlock the development potential of our properties.

Speaker Change: Our entitlement work for our identified near term development properties is progressing under the guidance of mid <unk> graft, our executive Vice President of land management.

Mitch: Mitch brings nearly four decades of experience in entitlement work throughout Florida.

Mitch: His deep expertise navigating the complex re zoning and land use approval processes in Florida is invaluable as we work to unlock the development potential of our properties.

John Kiernan: The Corkscrew Grove Villages development application we filed in March represents a significant milestone in our transformation. This property located in northwest Collier County at the strategic intersection of Collier, Wee, and Henry Counties is being planned for two mixed-use master plant communities consisting of approximately 1,500 acres each. As envisioned, the project will not only provide future residents with ample opportunities to live, work, and play in a growing part of Collier County, but will also enhance public infrastructure. permanently protect thousands of acres of sensitive land and enhance wetlands and water resources. The villages will provide significant economic benefit to the region.

Mitch: A corkscrew grow villages development application, we filed in March represents a significant milestone in our transformation.

Mitch: This property located in northwest Collier County at the strategic intersection of Collier, We end Henry counties.

Mitch: Is being planned for two mixed use masterplan communities, consisting of approximately 1500 acres each.

Mitch: As envisioned the project will not only provide future residents with ample opportunities to live work and play and a growing part of Collier County.

Mitch: But we'll also enhance public infrastructure.

Mitch: Permanent we protect thousands of acres of sensitive land and.

Mitch: And enhance wetlands and water resources.

Mitch: The villages will provide significant economic benefit to the region.

John Kiernan: and improvements will come at no additional cost to Collier County taxpayers. We expect the east and west villages will each accommodate approximately 4,500 homes. 280,000 square feet of commercial space, and approximately 70,000 square feet of civic amenities, including village greens, trails, lakes, and preserves. We are thoughtfully integrating residential, commercial, and civic spaces to create a place where people can live and work, all while enhancing convenience and providing shopping alternatives for residents of Eastern Lee County, Northern Collier, and Southern Hendry.

And improvements will come at no additional cost to Collier County taxpayers.

Mitch: We expect the east and west villages will each accommodate approximately 4500 homes.

Mitch: 280000 square feet of commercial space, and approximately 70000 square feet of civic amenities, including village Greens trails lakes and preserves.

Mitch: We are thoughtfully integrating residential commercial and civic spaces to create a place where people can live and work all while enhancing convenience and providing shopping alternatives for residents of eastern week County.

Speaker Change: Northern Collier and southern Henry.

John Kiernan: Our development application was submitted to Collier County for local approval for the first two villages. While the long-term vision for Corkscrew Grove Villages includes two villages, our current application with Collier County only seeks approval for the East Village as the first step of a multi-phased project. This current process is anticipated to take approximately one year, with the final decision expected in 2026.

Speaker Change: Our development application was submitted to Collier County for local approval for the first two villages.

Speaker Change: While the long term vision for corkscrew, we Gotta villages includes two villages our current application with Collier County, only seeks approval for the east village as the first step of a multi phased project.

Speaker Change: This current process is anticipated to take approximately one year with the final decision expected in 2026.

John Kiernan: Additionally, we have also submitted applications to the South Florida Water Management District and the U.S. Army Corps of Engineers for the entire Corkscrew Village property. Construction on East Villages could begin in 2028 or 2029 if all approvals are granted.

Speaker Change: Additionally, we have also submitted applications to the South Florida water management district in the U S. Army Corps of engineers for the entire core crew village property.

Speaker Change: Construction on east village's could begin in 2028 or 2029, if all approvals are granted.

John Kiernan: As part of the company's long-term planning efforts, we took the proactive step in January 2025 to seek legislative approval from the Florida Legislature to establish the Corkscrew Grove Stewardship District. Upon approval, the Corkscrew Grove Stewardship District will assist Alico in its efforts to effectively finance infrastructure, help restore and manage natural areas, and oversee the administration of the plaster plant communities and lands within the district. Importantly, our development approach incorporates strategies proposed by the Florida Wildlife Corridor and the Collier Rural Land Stewardship Area Program with plans to enhance and preserve over 6,000 acres for wildlife corridors and regional connected habitat.

Speaker Change: As part of the company's long term planning efforts, we took the proactive step in January 2025 to seek legislative approval from the Florida legislature to establish CT The Corkscrew Grove stewardship district.

Speaker Change: Upon approval the corkscrew grow stewardship district was just a week ago and its efforts to effectively finance infrastructure help restore and manage natural areas and oversee the administration of the plaster plant communities and lands within the district.

Importantly, our development approach incorporate strategy as proposed by the Florida Wildlife corridor and the call your rural land stewardship area program.

Speaker Change: With plans to enhance and preserve over 6000 acres for wildlife corridors and regional connected habitat.

John Kiernan: This commitment to environmental stewardship reflects our long-standing role as responsible land managers.

Speaker Change: This commitment to environmental stewardship reflects our long standing role as responsible land managers.

John Kiernan: We are also advancing entitlement work for our Bonnet Lake, Saddleback Grove, and Plant World properties, which collectively represent additional development opportunities across different Florida counties. While the entitlement process involves many variables and stakeholders that can affect timing, we're taking a methodical approach to navigate these complexities. Collectively, these four near-term development properties totaling approximately 5,500 acres are estimated to be worth between $335 million and $380 million in present value dollars and could be realized within the next five years. This represents significant value for our shareholders from just 10% of our land holdings.

We are also advancing entitlement work for our bond at Lake Saddlebag growth implant, where properties, which collectively represent additional development opportunities across different Florida counties.

Speaker Change: While the entitlement process involves many variables and stakeholders that can affect timing, we're taking a methodical approach to navigate these complexities.

Speaker Change: Collectively these four near term development properties totaling approximately 5500 acres are estimated to be worth between $335 million.

Speaker Change: $380 million in present value dollars and could be realized within the next five years.

This represents significant value for our shareholders from just 10% of our land holdings.

John Kiernan: To support our evolving business model, we recently amended our credit agreement effective March 31st, 2025. This amendment adjusts certain financial covenants and reduces crop and tree insurance coverage requirements which is expected to result in cost savings while providing us with the flexibility needed to execute our transformation.

Speaker Change: To support our evolving business model, we recently amended our credit agreement effective March 31 2025.

Speaker Change: This amendment adjust certain financial covenants and reduces crop and tree insurance coverage requirements, which is expected to result in cost savings, while providing us with the flexibility needed to execute our transformation.

John Kiernan: We've also expanded our capital allocation strategy with the announcement of a $50 million share repurchase program. As our cash balance increases through land sales and the establishment of diversified agricultural operations, we plan to maintain a balanced approach to capital deployment, including our quarterly dividend, opportunistic share repurchases, and strategic debt reduction.

Speaker Change: We've also expanded our capital allocation strategy with the announcement of a $50 million share repurchase program.

Speaker Change: As our cash balance increases through land sales and the establishment of diversified agricultural operations.

Speaker Change: We plan to maintain a balanced approach to capital deployment, including our quarterly dividend opportunistic share repurchases and strategic debt reduction.

John Kiernan: With these strategic initiatives well underway, I'm pleased with the progress we've made in positioning Alico for sustainable long-term growth.

Speaker Change: With these strategic initiatives well underway I'm pleased with the progress we've made in positioning a week out for sustainable long term growth.

John Kiernan: to provide more detail on our financial performance and the impact of these transformative steps on our balance sheet.

Speaker Change: To provide more detail on our financial performance and the impact of these transformative steps on our balance sheet.

Brad Heine: I will now turn it over to our CFO, Brad Heine. Thank you, John. Good morning, everyone. The second fiscal quarter ended March 31, 2025. Revenue decreased 1% to $18 million, compared to $18.1 million for the prior year. For the six months ended March 31st, 2025, revenue decreased 9% to $34.9 million. compared to $32.1 million for the prior year period. For the three and six months ended March 31, 2025, Alico Citrus harvested approximately 4.7 million and 8.7 million pound solids of fruit respectively, compared to 5.8 million and 10.4 million pound solids of fruit in the same periods of the prior fiscal year.

Speaker Change: I will now turn it over to our CFO Brad Heine.

Brad Heine: Thank you John and good morning, everyone.

Brad Heine: The second fiscal quarter ended March 31, 2025 revenue decreased 1% to 18 million compared to $18 1 million for the prior year period.

Brad Heine: For the six months ended March 31, 2025 revenue decreased 9% to $34 9 million.

Brad Heine: Compared to $32 1 million for the prior year period.

Brad Heine: For the three and six months ended March 31st 2025, Leeco, citrus harvested approximately $4 7 million and $8 7 million pound solids, respectively, compared to $5 8 million at $10 4 million pound solids in the same periods of the prior fiscal year.

Brad Heine: As expected, harvest volumes in 2025 were lower compared to 2024, driven by the impact of Hurricane Milton, which hit Florida in October of 2024. Alico's blended price per pound solids for the three and six months ended March 31st, 2025, increased 70 cents and 85 cents respectively, as compared to the same period in the prior year, as a result of more favorable pricing in one of our contracts with Tropicana. As John said, we completed our last major citrus harvest in April and have thus concluded the majority of our capital investment in our citrus operation. Land management and other operations revenue for the three and six months ended March 31st, 2025 increased 107 percent and 74 percent respectively as compared to the same periods in the prior year.

Brad Heine: As expected harvest volumes in 2025 were lower compared to 2024, driven by the impact of Hurricane Milton which hit Florida in October of 2024.

Brad Heine: ALLETE goes blended price per pound solids for the three and six months ended March 31, 2025 increased 70, and 85, respectively as compared to the same period in the prior year as a result of more favorable pricing in one of our contracts with Tropicana.

Brad Heine: As John said, we completed our last major citrus harvest in April and thus concluded the majority of our capital investment in our citrus operations.

Brad Heine: Land management another operations revenue for the three and six months ended March 31, 2025 increased 107% and 74% respectively as compared to the same periods in the prior year. The increase was primarily the result of an increase in rock and sand royalty income and <unk> sales partially.

Brad Heine: The increase was primarily the result of an increase in rock and sand royalty income and sod sales, partially offset by lower farming, grazing, and hunting lease revenues due to the sale of the Alico Ranch. Total operating expenses for the three and six months that had marched 31st 2025 for $167.7 million and $192.8 million respectively, as compared to $36.3 million and $64.5 million in the same periods in the prior year. The increase in operating expenses was driven by approximately $118 million of non-cash accelerated depreciation as a result of our strategic transformation, and the decision to wind down our citrus operations as well as the impairment of our young trees which were not yet being depreciated, and certain other assets at one of our grows of $25 General and administrative expenses for the three and six months ended March 31st, 2025 increased $1.1 million and $0.4 million, respectively, as compared to the same periods in the prior year.

Brad Heine: Offset by lower farming grazing and hunting lease revenues due to the sale of the LTE coverage.

Brad Heine: Total operating expenses for the three and six months ended March 31st 2025, or $167 7 million and $192 8 million, respectively, as compared to $36 3 million and $64 5 million in the same periods in the prior year.

Brad Heine: The increase in operating expenses was driven by approximately $118 million of noncash accelerated depreciation as a result of our strategic transformation and the decision to wind down our citrus operations as well as the impairment of our young trees, which were not yet being depreciated and certain other assets at one of our growth of $25 million.

Brad Heine: General and administrative expenses for the three and six months ended March 31, 2025 increased $1 1 million and <unk> 4 million, respectively as compared to the same periods in the prior year. The increase was primarily due to the accelerated depreciation on certain administrative assets and higher legal fees related to the strategic transformation.

Brad Heine: The increase was primarily due to the accelerated depreciation on certain administrative assets and higher legal fees related to the strategic transformation. Other income expense net for the three months ended March 31st, 2025, increased $15.3 million compared to the prior year period, driven by the sale of approximately 2,100 acres of land in the second quarter of 2025. Other income expense net for the six months ended March 31st, 2025, was a gain of $14.2 million compared to $75 million in the prior year period, driven by the sale of the Alico Ranch to the state of Florida in the prior year.

Brad Heine: Other income expense net for the three months ended March 31, 2025 increased $15 3 million compared to the prior year period.

Brad Heine: Driven by the sale of approximately 2100 acres of land in the second quarter of 2025.

Brad Heine: Other income expense net for the six months ended March 31, 2025 was a gain of $14 2 million compared to $75 million in the prior year period, driven by the sale of illegal ranch the state of Florida in the prior year.

Brad Heine: Okay.

Brad Heine: For the three months ended March 31st, 2025 and 2024, the company reported a net loss trivial to Alico Commons shareholders. of $111.4 million and $15.8 million, respectively. The increase in our net loss was principally the result of approximately $119 million of accelerated depreciation, principally on citrus trees, due to the strategic transformation and the decision to wind down our citrus operations, as well as the impairment of our young trees, which were not yet being depreciated, and the long-lived assets at one of our groves of $25 million. Partially offsetting this, land and equipment sales resulted in a gain of $15.8 million in the current quarter.

Brad Heine: For the three months ended March 31, 2025, and 2024 the company reported a net loss attributable to <unk> common shareholders.

Brad Heine: Mm $111 4 million and $15 8 million respectively.

Brad Heine: Increases in our net loss was principally the result of approximately $119 million of accelerated depreciation principally on citrus trees Disney prestige strategic transformation and the decision to wind down our citrus operations as well as the impairment of our young trees, which were not yet being depreciated in the long lived assets at one of our growth of 25.

Brad Heine: Yeah.

Partially offsetting this land and equipment sales resulted in a gain of $15 8 million in the current quarter. This was partially offset by a tax benefit of $26 9 million for the three months ended March 31 2025.

Brad Heine: This was partially offset by a tax benefit of $26.9 million for the three months ended March 31, 2025. For the three months ended March 31st, 2025, the company had a loss of $14.58 per diluted common share compared to a loss of $2.07 per diluted common share for the three months ended March 31st, 2025. For the three months ended March 31, 2025, EBITDA was a loss of $14.7 million compared to a loss of $16.5 million for the three months ended March 31, 2024, and adjusted EBITDA was The gain of $12.7 million compared to a loss of $16.5 million for the three months ended March 31, 2024.

Brad Heine: For the three months ended March 31st 2025, the company had a loss of $14 58 per diluted common share.

Brad Heine: Payer to a loss of $2 seven per diluted common share for the three months ended March 31 2024.

Brad Heine: For the three months ended March 31, 2025, EBITDA was a loss of $14 7 million compared to a loss of $16 5 million for the three months ended March 31, 2024 and.

Brad Heine: And adjusted EBITDA was.

Gain of $12 7 million compared to a loss of $16 5 million for the three months ended March 31 2024.

Brad Heine: Turning now to our balance sheet and liquidity. Cash and cash equivalents were $14.7 million as of March 31, 2025, compared to $3.2 million at the end of fiscal year 2024. Net cash used in operating activities was $0.6 million for the six months ended March 31, 2025, compared to $19.7 million for the six months ending March 31, 2024. At quarter end, we had approximately $88.5 million of remaining availability on our line of credit, and there were no significant debt maturities until 2029. Total debt was $89.6 million and net debt was $74.9 million as of March 31, 2025, compared to $92.1 million and $89 million respectively at the end of fiscal year 2024.

Brad Heine: Turning now to our balance sheet and liquidity.

Brad Heine: Cash and cash equivalents were $14 7 million as of March 31, 2025, compared to $3 2 million at the end of fiscal year 2024.

Brad Heine: Net cash used in operating activities was <unk> 6 million for the six months ended March 31, 2025, compared to $19 7 million for the six months ending March 31 2024.

Brad Heine: At quarter end, we had approximately $88 5 million of remaining availability on our line of credit and there were no significant debt maturities until 2029.

Brad Heine: Total debt was $89 6 million and net debt was $74 9 million as of March 31, 2025% compared to $92 1 million, an $89 million respectively. At the end of fiscal year 2024.

John Kiernan: Now I'd like to turn the call back to John to discuss our fiscal year 2025 outlook.

John: Now I'd like to turn the call back to John to discuss our fiscal year 2025 outlook.

John Kiernan: Thank you, Brad. Now let me share our guidance for fiscal year 2025 and some concluding thoughts on our strategic direction. Our strategic transformation to become a diversified land company has already exceeded our fiscal 2025 year goals. At this time, we are forecasting that our cash balance at the end of this fiscal year will be approximately $25 million, and our net debt will be approximately $60 million, with only the required $2.5 million balance outstanding under our revolving line of credit. We expect to generate approximately $20 million in adjusted EBITDA for fiscal year 2025. These projections are supported by the previously announced estimate of $20 million of land sales and cash generated by the 2024-2025 citrus harvest.

John: Thank you Brad.

John: Now, let me share our guidance for fiscal year, 2025, and some concluding thoughts on our strategic direction.

John: Our strategic transformation to become a diversified land company has already exceeded our fiscal 2025 year goals.

At this time, we are forecasting that our cash balance at the end of this fiscal year will be approximately $25 million and.

John: And our net debt will be approximately $60 million with only the required to $5 million balance outstanding under our revolving line of credit.

John: We expect to generate approximately $20 million and adjusted EBITDA for fiscal year 2025.

John: These projections are supported by the previously announced estimate of $20 million of land sales and cash generated by the 2020 for 2025 citrus harvest.

John Kiernan: We are currently projecting that land sales could potentially exceed $50 million this year, which would increase our adjusted EBITDA in cash and decrease our net debt projections. But we recognize that each pending transaction has its own challenges. Just as all previous sales Alico has transacted over the past decade have experienced. and there is no certainty regarding timing until sales are closed.

John: We are currently projecting that land sales could potentially exceed $50 million this year.

John: Which would increase our adjusted EBITDA and cash and decrease our net debt projections, but we recognize that each pending transaction has its own challenges just as all previous sales a week go has transacted over the past decade have experienced.

John: And there is no certainty regarding timing until sales are closed.

John Kiernan: Looking ahead to the remainder of fiscal year 2025, we'll focus on completing the sale of our remaining identified lands. continuing entitlement work on our development properties. finalizing agreements with agricultural operators for our diversified farming operations. and further strengthening our balance sheet to support long-term value creation. When considering the full scope of our transformation, we believe the present value of our current land holdings could be worth approximately $650 to $750 million, with roughly 75 percent valued for agricultural use and assuming about 10 percent entitled for development within the next five years. I'm confident that our strategic transformation positions Alico to deliver enhanced long-term returns for our shareholders.

John: Looking ahead to the remainder of fiscal year 2025, we will focus on completing the sale of our remaining identified lands.

John: Continuing entitlement work on our development properties.

John: Finalizing agreements with agriculture operators for our diversified farming operations and.

John: And further strengthening our balance sheet to support long term value creation.

John: When considering the full scope of our transformation, we believe the present value of our current landholdings could be worth approximately $650 to $750 million with roughly 75% value for agricultural use and assuming about 10% entitled for development within the next five years.

John: I am confident that our strategic transformation positions a week ago to deliver enhanced long term returns for our shareholders.

John Kiernan: by balancing the development of select high value properties with diversified agricultural operations. for creating a business model that leverages our core strength. while adapting to market opportunities.

John: Balancing the development of select high value properties with diversified agricultural operations, we're creating a business model that leverages, our core strengths while.

John: While adapting to market opportunities.

John Mills: With that, we'll now open the line to questions from industry analysts. Margo? Thank you.

John: And with that we'll now open the line to questions from industry analysts.

John: Argo.

Operator: At this time, if you'd like to ask a question, please press the star 1 on your telephone keypad. You may remove yourself from the queue at any time by pressing star 2. And once again, that is star 1 to ask a question.

Speaker Change: Thank you at this time, if you'd like to ask a question. Please press star one on your telephone keypad, you may remove yourself from the queue at any time by pressing star two and once again that is star one to ask a question, we'll take our question from Gerry Sweeney with Roth Capital. Please go ahead.

Brandon Rogers: We'll take our question from Gary Sweeney with Roth Capital. Please go ahead. Hello, this is Brandon Rogers on for Jerry Sweeney. Thanks for taking my question. Our pleasure. How are you doing, Brandon? Good, good.

Speaker Change: Hello. This is Randy Rogers on forget refrigerator Sweeney, thanks for taking my question.

Speaker Change: Our pleasure Brennan.

Speaker Change: Good good.

Brandon Rogers: I just had a question on the 15.8 landfill in the quarter. Could you just provide any additional color there? You said it was... who, how many, I don't know exactly how many acres you said, but... the 1,000 acres you're talking about. Yeah, the 15.8 That was 2100 acres. All right.

Speaker Change: I just had a question on the $15 eight landfill in the quarter could you just provide any additional color there.

Speaker Change: Got it.

Speaker Change:

Speaker Change: I don't know exactly how many acres you said.

Speaker Change: Hum.

Speaker Change: The 1000 acres you are talking about central banks.

Speaker Change: Yes.

Speaker Change: The 15th 2100, <unk> that was 2100 acres.

Speaker Change: Alright, and then what county was that located in.

Brandon Rogers: And then what county was that located in? Um... Off the top of my head, I... or Hendrick County. Henry.

Speaker Change: Off the top of my head.

Speaker Change: Okay, Henry Hendry County.

Brandon Rogers: All right. Thank you.

Speaker Change: Alright, Thank you and then so for.

Brandon Rogers: And then, so for the initial $50 million in land sales for the current year, are you in current discussions with any other land sales? And then what gives you confidence in potentially achieving the $50 million aspiring target for the year? We've negotiated an agreement to sell some acres. It's still going through a process, so it's going to go through diligence right now, and that's underway. So the timing is a bit uncertain as the diligence process proceeds. And the second part of your question is, we're talking to several other parties about potential land sales, but nothing that's solid enough for us to report at this time.

Speaker Change: <unk> 50.

Speaker Change: $50 million in land sales for the current year are you in discussions with any other land sales and then what gives you confidence in potentially achieving the $50 million ASP hiring target for the year.

Speaker Change: We have negotiated an agreement to sell.

Stu: Some acres it's Stu.

Stu: Going through a process. So it's going to go through diligence right now and Thats underway.

Stu: So the timing is a bit uncertain as the diligent process proceeds.

Stu: The second part of your question is we're talking to several other parties about potential land sales, but nothing that solid enough for us to report at this time.

Brandon Rogers: Thank you.

Stu: Okay. Thank you and then turning to <unk> you say construction on the village could begin in 2028 or 29, if all approvals are granted.

Brandon Rogers: And then turning to Corkscrew, you said construction on the village could begin in 2028 or 2029 if all approvals are granted. What are some potential milestones we can watch for between now and the potential entitlement approvals? I think the entitlement approvals themselves are kind of what the milestones would be. There will be a lot of kind of individual meetings and revisions and resubmittals as we go. But I think as you see the approvals at the local, state, and federal levels come through, you'll know where the milestones stand.

Stu: There are some potential milestones, we can watch for between now and the potential entitlement approvals.

Stu: I think the entitlement approvals themselves are kind of what the milestones would be there'll be a lot of kind of individual meetings and revisions and recent middles as we go.

Stu: I think as you see the approvals at the local state and federal levels come through you'll know where the milestone stand.

Brandon Rogers: and thank you for taking my questions. Thanks, Brandon. Thank you.

Speaker Change: Thank you for taking my questions.

Brandon: Thanks Brandon.

Operator: At this time we have no further questions.

Speaker Change: Thank you at this time, we have no further questions I would like to turn the call back over to our speakers for final remarks.

John Mills: I'd like to turn the call back over to our speakers for a final Thank you, Margo, and thank you to everyone for joining us today. We appreciate your continued support as we navigate this exciting strategic transformation, and we look forward to updating you on our further progress in the coming quarters. We'll see you in August.

Marco: Thank you Marco and thank you to everyone for joining us today.

Marco: We appreciate your continued support as we navigate this exciting strategic transformation.

Marco: And we look forward to updating you on our further progress in the coming quarters, we'll see you in August.

Operator: Thank you and this does conclude today's program. We thank you for your participation. You may disconnect at any time.

Marco: Thank you and this does conclude today's program. We thank you for your participation you may disconnect at any time.

Marco: [music].

Marco: Sure.

Marco: Yes.

Marco: [music].

Marco: Sure.

Marco: Sure.

Marco: Yeah.

Marco: Uh-huh.

Marco: [music].

Marco: Hum.

Sure.

Marco: Yeah.