Alico, Inc. Announces Purchase of Citrus Acres

Rhea-AI Summary

Alico, Inc. (Nasdaq: ALCO) announced the acquisition of approximately 3,280 gross citrus acres in Hendry County on October 30, 2020, for $16.45 million. This acquisition enhances Alico's existing 45,000 gross citrus acres, positioning it as a low-cost, high-producing citrus grower. The purchase utilized a like-kind exchange structure, deferring $4.0 million in taxes from a prior land sale. Alico operates primarily in citrus production and water resources, reaffirming its commitment to long-term leadership in the citrus industry.

Positive

• Acquired 3,280 gross citrus acres for $16.45 million, enhancing scale.
• Utilized a like-kind exchange structure, deferring $4.0 million in taxes.
• Acquisition supports Alico's strategy as a low-cost, high-producing citrus grower.

Negative

• None.

FORT MYERS, Fla., Nov. 02, 2020 (GLOBE NEWSWIRE) -- Alico, Inc. (“Alico” or the “Company”) (Nasdaq: ALCO) today announces that on October 30, 2020, the Company purchased approximately 3,280 gross citrus acres located in Hendry County for a purchase price of $16.45 million.

John Kiernan, Alico’s President and Chief Executive Officer, commented, “This acquisition of the Alexander Grove from the well-respected Gardinier Florida Citrus, Inc. allows Alico to add additional scale to our existing 45,000 gross acres of citrus properties. This Alexander Grove appears to have been very well maintained and substantial new plantings were completed in recent years. Strategically, the Alexander Grove neighbors existing Alico groves, and this will likely enable Alico to continue to operate as a low-cost, high producing citrus grower. We believe that this latest acquisition continues to demonstrate Alico’s commitment to being a long-term citrus industry leader.”

Mr. Kiernan continued, “Because this acquisition was completed using a like-kind exchange structure to fund most of the purchase price, we were able to defer approximately $4.0 million in taxes related to the gain from a sale of ranch land to the State of Florida, which closed in September 2020.”

About Alico

Alico, Inc. primarily operates two divisions: Alico Citrus, one of the nation’s largest citrus producers, and Alico Water Resources and Other Operations, a leading water storage and environmental services division. Learn more about Alico (Nasdaq: “ALCO”) at www.alicoinc.com.

Forward-Looking Statements

This press release 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 “plans,” “expect,” “may,” “anticipate,” “intend,” “should be,” “will be,” “is likely to,” “believes,” 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, regulation and rules; weather conditions that affect production, transportation, storage, demand, import and export of fresh product and their by-products; increased pressure from diseases including citrus greening and citrus canker, as well as insects and other pests; disruption of water supplies or changes in water allocations; market pricing of citrus; 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 and other growth and corporate opportunities; onetime events; acquisitions and divestitures; seasonality; 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; changes in agricultural land values; impact of the COVID-19 outbreak and the coronavirus pandemic on our agriculture operations, including without limitation demand for product, supply chain, health and availability of our labor force, the labor force of contractors we engage, and the labor force of our competitors; other risks related to the duration and severity of the COVID-19 outbreak and coronavirus pandemic and its impact on Alico’s business; the impact of the COVID-19 outbreak and coronavirus pandemic on the U.S. and global economies and financial markets; access to governmental loans and incentives; any reduction in the public float resulting from repurchases of common stock by Alico; changes in equity awards to employees; any increase in the public float resulting from the distribution by 734 Investors of its shares to its members; whether the Company's dividend policy, including its recent increased dividend amounts, is continued; expressed desire of certain of our stockholders to liquidate their shareholdings by virtue of past market sales of common stock by sales of common stock or by way of future transactions; political changes and economic crises; competitive actions by other companies; increased competition from international companies; changes in environmental regulations and their impact on farming practices; the land ownership policies of governments; changes in government farm programs and policies and international reaction to such programs; changes in pricing calculations with our customers; our ability to make strategic acquisitions; our ability to increase our common share dividend; our ability to consummate selected land acquisitions; our ability to take advantage of tax deferral options; fluctuations in the value of the U. S. dollar, interest rates, inflation and deflation rates; length of terms of contracts with customers; impact of concentration of sales to one customer; and changes in and effects of crop insurance programs, global trade agreements, trade restrictions and tariffs; and soil conditions, harvest yields, prices for commodities, and crop production expenses. 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 press release, except as required by law.

This press release also contain financial projections that are necessarily based upon a variety of estimates and assumptions which may not be realized and are inherently subject, in addition to the risks identified in the forward-looking statement disclaimer, to business, economic, competitive, industry, regulatory, market and financial uncertainties, many of which are beyond the Company’s control. There can be no assurance that the assumptions made in preparing the projected financial impact will prove accurate. Accordingly, actual results may differ materially from the projected financial impact.

Investor Contact:

Investor Relations
(646) 277-1254
InvestorRelations@alicoinc.com

Richard Rallo
Senior Vice President and Chief Financial Officer
(239) 226-2000
rrallo@alicoinc.com

FAQ

What recent acquisition did Alico (ALCO) announce?

Alico announced the purchase of approximately 3,280 gross citrus acres in Hendry County for $16.45 million.

How much did Alico save in taxes with the recent acquisition?

Alico deferred approximately $4.0 million in taxes using a like-kind exchange for the acquisition.

What is the significance of the Alexander Grove acquisition for Alico (ALCO)?

The acquisition allows Alico to add scale to its operations and enhances its position as a low-cost, high-producing citrus grower.

When was the acquisition by Alico completed?

The acquisition was completed on October 30, 2020.