Alico, Inc.
P. O. Box 338
La Belle, FL 33975
November 13, 2001
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
Pursuant to the requirements of the Securities Exchange Act of 1934, we are
transmitting herewith the attached Form 10-K for the year ending August 31,
2001.
Sincerely,
ALICO, INC.
L. Craig Simmons
L. Craig Simmons
Vice President and
Chief Financial Officer
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
__X__ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended August 31, 2001.
OR
_____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
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 or organization) Identification No.)
P. O. Box 338, La Belle, Florida 33975
________________________________________ __________
(Address of principal executive offices) (Zip Code)
(863)675-2966
Registrant's telephone number, including area code______________
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Name of each exchange on
Title of each class which registered
___________________ ________________________
None None
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
COMMON CAPITAL STOCK, $1.00 Par value, Non-cumulative
_____________________________________________________
(Title of Class)
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
such registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes __X__ No_____
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. _____
As of October 12, 2001 there were 7,059,039 shares of stock outstanding and
the aggregate market value (based upon the average bid and asked price, as
quoted on NASDAQ) of the common stock held by non-affiliates was
approximately $88,722,551.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's Proxy Statement dated November 16, 2001
are incorporated by reference in Parts II and III, respectively.
PART I
______
Item 1. Business.
__________________________
Alico, Inc. (the "Company") is generally recognized as an agribusiness
company operating in Central and Southwest Florida. The Company's primary
asset is 142,551 acres of land located in Collier, Hendry, Lee and Polk
Counties. (See table on Page 7 for location and acreage by current primary
use.) The Company is involved in various operations and activities
including citrus fruit production, cattle ranching, sugarcane and sod
production, and forestry. The Company also leases land for farming, cattle
grazing, recreation, and oil exploration.
The Company's land is managed for multiple use wherever possible. Cattle
ranching, forestry and land leased for farming, grazing, recreation and oil
exploration, in some instances, utilize the same acreage.
Agricultural operations have combined to produce from 68 to 91 percent of
annual revenues during the past five years. Citrus groves generate the
most gross revenue. Sugarcane ranks second in revenue production. While
the cattle ranching operation utilizes the largest acreage, it ranks third
in the production of revenue. Approximately 9,197 acres of the Company's
property are classified as timberlands, however, the area in which these
lands are located is not highly rated for timber production. These lands
are also utilized as native range, in the ranching operation, and leased
out for recreation and oil exploration.
Diversification of the Company's agricultural base was initiated with the
development of a Sugarcane Division at the end of the 1988 fiscal year.
The 11,722 acres in production during the 2001 fiscal year consisted of
903 acres planted in 1995, 2,649 acres planted in 1996, 2,430 acres planted
in 1997, 3,377 acres planted in 1998, 2,363 acres planted in 1999.
Leasing of lands for rock mining and oil and mineral exploration, rental of
land for grazing, farming, recreation and other uses, while not classified
as agricultural operations, are important components of the Company's land
utilization and operation. Gross revenue from these activities during the
past five years has ranged from 2 to 3 percent of total revenue.
The Company is not in the land sales and development business, except
through its wholly owned subsidiary, Saddlebag Lake Resorts, Inc.; however,
it does from time to time sell properties which, in the judgment of
management, are surplus to the Company's primary operations. Gross revenue
from land sales during the past five years has ranged from 1 to 24 percent
of total revenues.
For further discussion of the relative importance of the various segments
of the Company's operations, including financial information regarding
revenues, operating profits (losses) and assets attributable to each major
segment of the Company's business, see Note 14 of Notes to Consolidated
Financial Statements and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" included elsewhere in this document.
Subsidiary Operations
_____________________
The Company has two wholly owned subsidiaries; Saddlebag Lake Resorts,
Inc. ("Saddlebag") and Agri-Insurance Company, Ltd. ("Agri").
Saddlebag has been active in the subdividing, development and sale of
real estate since its inception in 1971. Saddlebag has two
subdivisions near Frostproof, Florida which have been developed
and are on the market. Approximately 61% of the lots have been sold.
Agri, formed during fiscal 2000, was created to write crop insurance
against catastrophic losses due to weather and disease. The subsidiary
wrote minor policies during 2000. During fiscal 2001, Agri supplied
reinsurance to an independent underwriter who insured
catastrophic business interruption coverage for Ben Hill Griffin, Inc.
The total coverage under the policy was $3,143,537 and the premium charged
was $126,860. The coverage term was from December 19, 2000 to December 19,
2001. There was a claim incurred during the year totaling $212,000. The
Company expects to renew the policy and appropriately adjust premium
rates. The financial results of the operation of these subsidiaries
are consolidated with those of the Company. (See Note 1 of Notes to
Consolidated Financial Statements.)
Citrus
______
Approximately 10,371 acres of citrus were harvested during the 2000 season.
Since 1983 the Company has maintained a marketing contract covering the
majority of the Company's citrus crop with Ben Hill Griffin, Inc., a
Florida corporation and major shareholder. The agreement provides for
modifications to meet changing market conditions and provides that either
party may terminate the contract by giving notice prior to August 1st,
preceding the fruit season immediately following. Under the terms of the
contract the Company's fruit is packed and/or processed and sold along with
fruit from other growers, including Ben Hill Griffin, Inc. The proceeds
are distributed on a pro rata basis as the finished product is sold.
During the year ended August 31, 2001, approximately 77% of the Company's
fruit crop was marketed under this agreement, as compared to 76% in 1999/00.
In addition, Ben Hill Griffin, Inc. provides harvesting services to the
Company for citrus sold to unrelated processors. These sales accounted for
the remaining 23% of total citrus revenue for the year. In fiscal year
1999, approximately 89% of the Company's fruit crop was marketed under this
agreement.
Ranch
______
The Company has a cattle operation located in Hendry and Collier counties,
Florida which is engaged primarily in the production of beef cattle and the
raising of replacement heifers. The breeding herd consists of
approximately 14,000 cows, bulls and replacement heifers. Approximately
44% of the herd are from one to five years old, while the remaining 56% are
six and older. The Company primarily sells to packing and processing
plants. The Company also sells cattle through local livestock auction
markets and to contract cattle buyers. These buyers provide ready markets
for the Company's cattle. The loss of any one or a few of these plants
and/or buyers would not, in management's view, have a material adverse
effect on the Company's cattle operation. Subject to prevailing market
conditions, the Company may hedge its beef inventory by entering into cattle
futures contracts to reduce exposure to changes in market prices.
Sugarcane
_________
The Company had 11,722 acres, 9,588 acres, and 5,432 acres of sugarcane
in production during the 2000/01,1999/00, and 1998/99 fiscal years,
respectively. The 2000/01, 1999/00, and 1998/99 crops yielded
approximately 417,000, 321,000, and 216,000 gross tons, respectively.
Forest Products
_______________
Approximately 6% of the Company's properties are classified as timberlands.
The principal forest products sold by the Company are pulpwood and sabal
palms. These products are sold to a paper company and various landscaping
companies, respectively. The Company does not incur any of the harvesting
expenses.
Part of the lands, from which the timber was removed, is being converted to
semi-improved pasture and other uses.
Land Rental for Grazing, Agricultural and Other Uses
____________________________________________________
The Company rents land to others for grazing, farming and recreational
uses, on a tenant-at-will basis, for an annual fee. The income is not
significant when compared to overall gross income, however, it does help to
offset the expense of carrying these properties until they are put to a
more profitable use. The Company has developed additional land to lease
for farming.
There were no significant changes in the method of rental for these
purposes during the past fiscal year.
Leases for Oil and Mineral Exploration
______________________________________
The Company has leased subsurface rights to a portion of its properties
for the purpose of oil and mineral exploration. Currently, there are two
leases in effect.
Twenty-four wells have been drilled during the years that the Company has
been leasing subsurface rights to oil companies. The drilling has resulted
in twenty-one dry holes, one marginal producer, which has been abandoned,
and two average producers, still producing.
Mining Operations: Rock and Sand
_________________________________
The Company leases 7,927 acres in Lee County, Florida to CSR America,
Inc. of West Palm Beach, Florida for mining and production of rock,
aggregate, sand, baserock and other road building and construction
materials.
Royalties which the company receives for these products are based on a
percentage of the F.O.B. plant sales price.
Competition
___________
As indicated, the Company is primarily engaged in a limited number of
agricultural activities, all of which are highly competitive. For
instance, citrus is grown in several states, the most notable of which are:
Florida, California, Arizona and Texas. In addition, citrus and sugarcane
products are imported from some foreign countries. Beef cattle are
produced throughout the United States and domestic beef sales must also
compete with sales of imported beef. Additionally, forest and rock
products are produced in most parts of the United States. Leasing of land
for oil exploration is also widespread.
The Company's share of the market for citrus, sugarcane, cattle and forest
products in the United States is insignificant.
Environmental Regulations
_________________________
The Company's operation is subject to various federal, state and local laws
regulating the discharge of materials into the environment. The Company is
in substantial compliance with all such rules and such compliance has not
had a material effect upon capital expenditures, earnings or the
competitive position of the Company.
While compliance with environmental regulations has not had a material
economic effect on the Company's operations, executive officers are
required to spend a considerable amount of time keeping current on these
matters. In addition, there are ongoing costs incurred in complying with
the permitting and reporting requirements.
Employees
_________
At the end of August 2001, the Company had a total of 150 full-time
employees classified as follows: Citrus 71; Ranch 22; Sugarcane 15;
Facilities Maintenance Support 28; General and Administrative 14. There
are no employees engaged in the development of new products or research.
Management is not aware of any efforts by employees or outside organizers
to create any type of labor union arrangement. Management believes that
the employer/employee relationship environment is such that labor
organization activities are unlikely to occur.
Seasonal Nature of Business
___________________________
As with any agribusiness enterprise, the Company's business operations are
predominantly seasonal in nature. The harvest and sale of citrus fruit
generally occurs from October to June. Sugarcane is harvested during the
first, second and third quarters. Other segments of the Company's business
such as its cattle and sod sales, and its timber, mining and leasing
operations, tend to be more successive than seasonal in nature.
Item 2. Properties.
____________________________
At August 31, 2001, the Company owned a total of 142,551 acres of land
located in four counties in Florida. Acreage in each county and the
primary classification with respect to present use of these properties is
shown in the following table:
ACREAGE BY CURRENT PRIMARY USE
______________________________
Timber Native Improved Citrus Sugar- Agri-
County Land Pasture Pasture Sod Land cane culture Other Total
___________________________________________________________________________
Polk 251 9,270 447 -- 3,251 -- -- 1 13,220
Lee 3,221 1,086 -- -- -- -- 1,460 2,369 8,136
Hendry 3,823 45,741 24,774 280 3,763 12,056 15,953 3,629 110,019
Collier 1,902 1,700 1,112 -- 4,129 -- -- 2,333 11,176
______ _______ ______ ___ _____ _____ _____ _____ _______
Totals 9,197 57,797 26,333 280 11,143 12,056 17,413 8,332 142,551
______ _______ ______ ___ _____ _____ ______ _____ _______
______ _______ ______ ___ _____ _____ ______ _____ _______
Of the above lands, the Company utilizes 24,178 acres of improved pasture
plus approximately 50,000 acres of native pasture for cattle production and
7,927 acres are leased for rock mining operations. Much of the land is
also leased for multi-purpose use such as cattle grazing, oil exploration,
agriculture and recreation.
In addition to the land shown in the above table, the Company owns full
subsurface rights to 1,064 acres and fractional subsurface rights to
18,707 acres.
From the inception of the Company's initial development program in 1948,
the goal has been to develop the lands for the most profitable use. Prior
to implementation of the development program, detailed studies were made of
the properties focusing on soil capabilities, topography, transportation,
availability of markets and the climatic characteristics of each of the
tracts. Based on these and later studies, the use of each tract was
determined. It is the opinion of Management that the lands are suitable
for agricultural, residential and commercial uses. However, since the
Company is primarily engaged in agricultural activities, some of the lands
are considered surplus to its needs for this purpose and, as indicated
under Item 1 of this report, sales of real property are made from time to
time.
Management believes that each of the major programs is adequately supported
by agricultural equipment, buildings, fences, irrigation systems and other
amenities required for the operation of the projects.
Item 3. Legal Proceedings.
___________________________________
The Company has been informed by Ben Hill Griffin III that he is
party to a lawsuit filed against him in Polk County, Florida Circuit
Court by the families of his four sisters, most of the members of whom
are beneficiaries of a trust, entitled the Ben Hill Griffin, Jr.
Revocable Intervisos Trust #1 (the "Trust"). The plaintiffs in the
lawsuit (The Four Sisters Protectorate, et al. v. Ben Hill Griffin,
III, Trustee, Case No. GC-G-0054, Section 81) sought to impose
judicial sanctions on Mr. Griffin III, including his removal as
Trustee of the Trust based on allegations of over-compensation
and receipt of an illegal bonus. On March 29, 2001, after
court-ordered mediation pending completion of which the trial was
adjourned, Mr. Griffin III and a representative of the Four Sisters
Protectorate, joined by their respective counsel, executed a
"Settlement Agreement" which set forth the basic elements of
a settlement of the lawsuit, contingent upon several events,
including Internal Revenue Service approval of the proposed
transaction as a tax free split-off for federal income tax
purposes, and the Court's judicial termination of the Trust.
The terms contained in the Settlement Agreement were not intended,
nor were they sufficient, to resolve all specific items necessary
to consummate a settlement of the lawsuit. The Settlement Agreement
provided that the shares of Alico stock then owned by Ben Hill Griffin
Investments would be utilized in the tax free split-off, along with
other assets, as a means of allocating to the Four Sisters Protectorate
assets approximating the value of their interests in Ben Hill Griffin
Investments, a holding company wholly owned by the Trust, Ben Hill
Griffin III, and the families represented in the Four Sisters Protectorate.
Mr. Griffin III has indicated that almost immediately following execution
of the Settlement Agreement the parties disagreed as to its validity
or enforceability on various grounds. On May 14, 2001, the Harris Family
filed a motion in the Circuit Court of the 10th Judicial Circuit in
and for Polka County, Florida (Case No. GC-G-0054) seeking to have the
Settlement Agreement set aside as invalid and unenforceable. On
November 2, 2001 the Court entered a written order that the
Settlement Agreement is enforceable. Mr. Griffin III's attorneys indicate
that a large number of issues related to the mechanism and terms of the
proposed distribution of certain of the assets of the Trust to the
families of the four sisters, including the Alico stock beneficially
owned by the Trust, remain to be worked out between the representatives
of the four sisters and Ben Hill Griffin III and are currently being
negotiated. According to them these terms are expected to be set
forth in a definitive separation agreement, which is still being negotiated
by the parties to the litigation but is expected to be finalized shortly.
The Company further understands that consummation of the settlement will
be subject to various conditions which are still being discussed,
but will include the requirement that the parties receive a favorable
IRS Revenue Ruling. Mr. Griffin III's attorneys indicate that no ruling
request has yet been submitted. Neither the Company nor Mr. Griffin III
know when or if the settlement will be implemented but believe the IRS
ruling process alone could take 6 months from the date a ruling request
is submitted.
Mr. Griffin III has also informed the Company that immediately before
the hearing on the enforcement of the State court action, lawyers
for the Harris family provided Mr. Griffin III's attorneys with copies
of a federal court action naming among others as defendants, Mr. Griffin III,
individually and as Trustee of the Ben Hill Griffin Jr. Revocable Intervisos
Trust #1, and BHG Inc. According to Mr. Griffin III's attorneys, this
Litigation was filed in the federal district court for the Northern District
of Florida (Case No: 4:olcv 432-5PM). The complaint, among other things,
seeks to set aside the settlement agreement based on alleged violations
of the securities laws, fraud, and negligence. Although this suit was filed
on October 2, 2001, Mr. Griffin III's attorneys indicate that, as of this
date, neither Mr. Griffin III nor BHG Inc. has been served in this action.
Mr. Griffin III's attorneys have indicated that they believe this suit is
without merit, if not frivolous, and have stated that if Mr. Griffin III
is ever served, he will defend it vigorously.
Since the Company opted out of the Florida Business Corporation Act's provisions
on Affiliated Transactions and Control Share Acquisitions (currently FBCA
s. 607.0901 and s. 607.0902) under the predecessor statutes to such sections,
transactions contemplated by the Settlement Agreement may not be subject
to shareholder approval or review by the Company's Board of Directors.
The Company is not a party to any of this litigation.
Item 4. Submission of Matters to a Vote of Security Holders.
_____________________________________________________________________
None.
PART II
_______
Item 5. Market for the Registrant's Common Stock and Related
Stockholder Matters.
_____________________________________________________________________
Common Stock Prices
___________________
The common stock of Alico, Inc. is traded over-the-counter on the NASDAQ
National Market System under the symbol ALCO. The high and low sales
prices, by fiscal quarter, during the years ended August 31, 2001 and 2000
are presented below:
2001 2000
Bid Price Bid Price
_________ _________
High Low High Low
First Quarter 16 13/16 15 5/16 16 5/16 14 1/2
Second Quarter 17 3/4 15 5/8 18 1/8 15 1/4
Third Quarter 28 5/8 15 3/4 17 1/4 15 1/16
Fourth Quarter 32 1/16 26 5/8 18 14 13/16
Approximate Number of Holders of Common Stock
_____________________________________________
As of October 12, 2001, there were approximately 680 holders of record of
Alico, Inc. Common Stock.
Dividend Information
____________________
Only year-end dividends have been paid, and during the last three fiscal
years were as follows:
Amount Paid
Record Date Payment Date Per Share
___________ ____________ ___________
October 19, 1998 November 6, 1998 $ .50
October 18, 1999 November 5, 1999 $ .30
October 13, 2000 October 27, 2000 $1.00
Dividends are paid at the discretion of the Company's Board of Directors.
The Company foresees no change in its ability to pay annual dividends in
the immediate future; nevertheless, there is no assurance that dividends
will be paid in the future since they are dependent upon earnings, the
financial condition of the Company, and other factors.
Item 6. Selected Financial Data.
_________________________________________
Years Ended August 3l,
DESCRIPTION 2001 2000(a) 1999 1998 1997
________ ________ ________ ________ ________
(In Thousands, Except Per Share Amounts)
Revenues $ 68,318 $ 62,540 $ 44,947 $ 44,679 $ 47,433
Costs and Expenses 48,205 41,965 37,886 33,654 29,583
Income Taxes 4,046 6,464 2,980 4,249 6,677
Net Income 16,066 14,111 4,081 6,776 11,173
Average Number of
Shares Outstanding 7,033 7,028 7,028 7,028 7,028
Net Income Per Share 2.29 2.01 .58 .96 1.59
Cash Dividend Paid per Share 1.00 .30 .50 .60 .15
Current Assets 61,345 56,578 45,182 42,354 37,887
Total Assets 179,134 176,876 156,922 130,554 117,723
Current Liabilities 7,691 12,346 8,738 5,649 4,988
Ratio-Current Assets
to Current Liabilities 7.98:1 4.58:1 5.17:1 7.50:1 7.59:1
Working Capital 53,654 44,232 36,444 36,705 32,899
Long-Term Obligations 58,818 60,985 56,789 34,938 24,582
Total Liabilities 66,508 73,331 65,527 40,587 29,570
Stockholders' Equity 112,625 103,545 91,395 89,967 88,153
(a) Certain amounts from 2000 have been reclassified to conform to the
2001 presentation.
Item 7. Management's Discussion and Analysis of Financial
__________________________________________________________________
Condition and Results of Operations.
____________________________________
The following discussion focuses on the results of operations and the
financial condition of Alico.
This section should be read in conjunction with the consolidated financial
statements and notes.
Liquidity and Capital Resources
_______________________________
The Company had cash and marketable securities of $25.0 million at August
31, 2001 compared with $19.9 million at August 31, 2000. Working capital
increased from $44.2 million at August 31, 2000 to $53.7 million at
August 31, 2001.
Cash outlay for land, equipment, building, and other improvements totaled
$8.9 million during fiscal 2001, compared to $10.0 million during August
31, 2000 and $27.9 million in 1999, respectively. Land preparation for
sugarcane development and capital maintenance continued, as did
expenditures for replacement equipment and raising of breeding cattle.
Capital projects for the upcoming year are expected to include development
of additional sod acreage.
Management believes that the Company will be able to meet its working
capital requirements for the foreseeable future with internally generated
funds. In addition, the Company has credit commitments which provide
for revolving credit of up to $44 million of which $12.2 million was
available for the Company's general use at August 31, 2001 (see Note 6 of
Notes to consolidated financial statements).
Cautionary Statement
____________________
Readers should note, in particular, that this document 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 affect 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.
Results of Operations
_____________________
Summary of results (in thousands):
Years Ended August 31,
2001 2000 1999
_______ _______ _______
Operating revenue $54,609 $45,335 $39,346
Gross profit 9,665 7,202 3,997
Profit on sale of real estate 11,352 13,299 3,847
Interest and investment income 2,124 3,094 1,302
Interest expense 3,029 3,020 2,085
Provision for income taxes 4,046 6,464 2,980
Effective income tax rate 20.1% 31.4% 42.2%
Net income 16,066 14,111 4,081
Operating Revenue
_________________
Operating revenues for fiscal 2001 increased compared to fiscal 2000.
An increase in revenues from agricultural activities was the most
significant factor in the rise.
Operating revenues for fiscal 2000 increased when compared to those of
fiscal 1999. An increase in revenues from agricultural activities was
the most significant factor in the rise.
Gross Profit
____________
Gross profit from operations increased 35% during fiscal 2001. Increased
sugarcane production and cattle sales are, combined with improved market
prices, the primary factors in the rise.
Gross profit from operations increased 80% during fiscal 2000. Improved
market prices for both citrus and beef combined with increased citrus
production as the primary factors in the rise.
Profit on Sale of Real Estate
____________________________________
Profit from the sale of real estate retail land sales, made through
Saddlebag, decreased from $18 thousand 13.3 million in fiscal
2000 to $(2) thousand 11.4 million in fiscal 2001. Profit from the
sale of bulk land sales, made through Agri, decreased from $13.3
million in fiscal 2000 to $11.4 million in fiscal 2001. The Company
Additionally, Agri recognized a $9.54 million gain on the sale of
488 acres, sold during fiscal 2000, upon receipt of the first annual
mortgage payment which, combined with the initial payment in
fiscal 2000, exceeded 20 30% of the contract price.
Real estate profits increased from $3.8 million to $13.3 million during
fiscal 2000. The most significant factor in the increase was the sale
of 1,270 acres in Lee County, Florida for $16.5 million. The sale
generated a $13.4 million pre-tax gain.
Interest and Investment Income
______________________________
Interest and investment income is generated principally from investments in
marketable equity securities, corporate and municipal bonds, mutual funds,
U.S. Treasury securities and mortgages held on real estate sold on the
installment basis. Realized investment earnings were reinvested throughout
fiscal 2001, 2000 and 1999, increasing investment levels during each year.
The decrease in fiscal 2001 interest and realized and unrealized investment
income resulted from unfavorable market conditions. The rise in fiscal 2000
and 1999 interest and realized and unrealized investment income for the years
presented resulted from reinvested investment income and favorable market
conditions during each of the years.
Interest Expense
________________
Interest expense increased during fiscal 2001, 2000 and 1999, compared to
each respective prior year. This was primarily due to increased borrowings
related to the acquisition of 7,680 acres of sugarcane, citrus and ranch
during fiscal 1999. Total interest cost increased slightly in 2001 and
increased 54% and 53% during 2000 and 1999, respectively.
Individual Operating Divisions
______________________________
Gross profit for the individual operating divisions, for fiscal 2001, 2000
and 1999, is presented in the following schedule and is discussed in
subsequent sections:
Years Ended August 31,
(in thousands)
2001 2000 1999
_______ _______ _______
CITRUS
Revenues:
Sales $27,570 $28,172 $23,518
Less harvesting & marketing 10,046 9,737 7,902
_______ _______ _______
Net Sales 17,524 18,435 15,616
Cost and Expenses:
Direct production** 8,932 8,665 10,198
Allocated cost* 3,472 3,040 2,977
_______ _______ _______
Total 12,404 11,695 13,175
_______ _______ _______
Gross profit, citrus 5,120 6,740 2,441
_______ _______ _______
SUGARCANE
Revenues:
Sales 11,939 8,501 7,120
Less harvesting & hauling 2,516 1,997 1,341
_______ _______ _______
Net Sales 9,423 6,504 5,779
Costs and expenses:
Direct production 3,810 2,787 1,886
Allocated cost* 2,992 2,178 1,257
_______ _______ _______
Total 6,802 4,965 3,143
_______ _____ _______
Gross profit, sugarcane 2,621 1,539 2,636
_______ _______ _______
RANCH
Revenues:
Sales 9,299 6,062 6,271
Costs and expenses:
Direct production 5,571 3,844 4,507
Allocated cost* 2,133 1,479 1,772
_______ _______ _______
Total 7,704 5,323 6,279
_______ _______ _______
Gross profit (loss), ranch 1,595 739 (8)
_______ _______ _______
Total gross profit,
agriculture 9,336 9,018 5,069
_______ _______ _______
OTHER OPERATIONS
Revenues:
Rock products and sand 1,726 1,320 1,350
Oil leases and land rentals 770 923 711
Forest products 91 84 136
Recovery of citrus eradication costs
in excess of basis 2,968 235 -
Other 245 37 240
_______ _______ _______
Total 5,800 2,599 2,437
Costs and expenses:
Allocated Cost* 604 658 767
General and administrative,
all operations 4,867 3,757 2,742
_______ _______ _______
Total 5,471 4,415 3,509
_______ _______ _______
Gross loss, other
operations 329 (1,816) (1,072)
_______ _______ _______
Total gross profit 9,665 7,202 3,997
_______ _______ _______
INTEREST & DIVIDENDS
Revenue 2,124 3,094 1,302
Expense 3,029 3,020 2,085
_______ _______ _______
Interest & dividends, net (905) 74 (783)
_______ _______ _______
REAL ESTATE
Revenue:
Sale of real estate 12,442 14,112 4,299
Expenses:
Cost of sales 857 126 92
Other Costs 233 687 360
_______ _______ _______
Total 1,090 813 452
_______ _______ _______
Gain on sale of real estate 11,352 13,299 3,847
_______ _______ _______
Income before income taxes $20,112 $20,575 $ 7,061
_______ _______ _______
_______ _______ _______
* Allocated expense includes ad valorem and payroll taxes, depreciation
and insurance.
** Excludes capitalized maintenance cost of groves less than five years of
age consisting of $200 thousand on 570 acres in 2001 $309 thousand on
411 acres in 2000, and $434 thousand on 134 acres in 1999.
Citrus
______
Gross profit was $ 5.1 million in fiscal 2001, $6.7 million in fiscal 2000,
and $2.4 million for fiscal 1999.
Revenue from citrus sales decreased 2% during fiscal 2001, compared to
fiscal 2000 ($27.6 million during fiscal 2001 vs. $28.2 million during
fiscal 2000).
Production increased during fiscal 2001, however, the average market
price decreased, compared to fiscal 2000.
Harvesting and marketing costs increased over the prior year due to the
increase in boxes harvested during the year. Direct production and
allocated costs increased 8% due to inflation and increased cultivation
costs related to replanting trees.
Revenue from citrus sales increased 20% during fiscal 2000, compared
to fiscal 1999 ($28.2 million during fiscal 2000 vs. $23.5 million during
fiscal 1999).
Production and the average market price improved during fiscal 2000,
compared to fiscal 1999.
Harvesting and marketing costs increased over the prior year, corresponding
with an increase in yields. Direct production and allocated costs decreased
13% resulting from more favorable growing conditions, requiring less
caretaking expenses.
The final returns from citrus pools are not precisely determinable at year
end. Returns are estimated each year based on the most current information
available. Differences between the estimates and the final realization
of revenues can be significant. Revenues collected in excess of prior
year and year end estimates were $617 thousand, $1.8 million, and
$160 thousand during fiscal 2001, 2000 and 1999, respectively.
ACREAGE BY VARIETY AND AGE
VARIETY 1-4 5-6 7-8 9-10 11-12 13-14 15-16 17+ Acres
___ ___ ___ ____ _____ _____ _____ ____ _____
Early:
Parson Brown
Oranges - - - 117 - 30 - - 147
Hamlin
Oranges 158 22 - 63 - 159 915 2,152 3,469
Red Grapefruit - - - - - 73 - 335 408
White Grapefruit - - - - - - - - -
Tangelos - - - - - - - 38 38
Navel Oranges - - - - - - - 138 138
Mid Season:
Pineapple
Oranges - - 102 - - - - 518 620
Queen Oranges - - - - - - - - -
Honey
Tangerines - - 76 - - - - 143 219
Midsweet
Oranges 117 - 164 - - - - - 281
Late:
Valencia
Oranges 540 238 585 366 958 291 493 1,504 4,975
_____ ___ ___ ___ _____ ___ ___ _____ _____
Totals: 815 260 927 546 958 553 1,408 4,828 10,295
Sugarcane
_________
Gross profit for fiscal 2001 was $2.6 million compared to $1.5 million in
fiscal 2000, and $2.6 million in fiscal 1999.
Sales revenues from sugarcane increased 40% during fiscal 2001, compared to
fiscal 2000 ($11.9 million vs. $8.5 million, respectively). Direct
production costs increased 37% during fiscal 2001, compared to fiscal 2000,
respectively.) The rise in revenue and related costs was the result of the
increase in the number of producing acres and improved market prices for
sugar.
Sales revenues from sugarcane increased 20% during fiscal 2000, compared to
fiscal 1999 ($8.5 million vs. $7.1 million, respectively). The rise in
revenue and related costs was the result of the increase in the number
of producing acres. However, a decline in the market price for sugar
and sugar yield per acre offset the increased production, creating a 42%
decrease in division earnings.
Ranching
________
The gross profit (loss) from ranch operations for fiscal 2001, 2000 and 1999
was $1.6 million, $739 thousand, and ($8) thousand, respectively.
Revenues from cattle sales increased 54% during fiscal 2001, compared to
fiscal 2000 ($9.3 million in fiscal 2001 vs. $6.1 million in fiscal 2000).
The number of animals sold during fiscal 2001 increased 52% over the prior
year due to increased in the number of feeder cattle sold during the current
year. The rise in revenue was also affected by improved market prices for
beef.
Direct and allocated costs increased 45% when compared to the prior year
($7.5 million during fiscal 2001 and $5.1 million during fiscal 2000)
corresponding to the decrease in the number of animals sold.
Revenues from cattle sales decreased 3% during fiscal 2000, compared to
fiscal 1999 ($6.1 million in fiscal 2000 vs. $6.3 million in fiscal 1999).
The number of animals sold during the year decreased 13% under the prior
year due to decreased sales of feeder cattle during the year. However, a
significant improvement in market prices for beef is the primary cause
of the increase in earnings for the division.
Direct and allocated costs decreased 16% when compared to the prior year
($5.3 million during fiscal 2000 and $6.3 million during fiscal 1999)
corresponding to the decrease in the number of animals sold.
The Company's cattle marketing activities include retention of calves in
western feedlots, contract and auction sales, and risk management contracts.
Other Operations
________________
Revenues from oil royalties and land rentals were $770 thousand as compared
to $923 thousand for fiscal 2000 and $711 thousand for fiscal 1999.
Returns from rock products and sand were $1.7 million for fiscal 2001,
$1.3 million for 2000 and $1.3 million during 1999. Rock and sand
supplies are sufficient to meet current demand, and no major price changes
have occurred over the past 3 years.
Profits from the sale of sabal palms, for landscaping purposes, during
fiscal 2001 were $91 thousand compared to $84 thousand and $136 thousand
for fiscal years 2000 and 1999, respectively.
Direct and allocated expenses charged to the "Other" operations category
included general and administrative and other costs not charged directly to
the citrus, ranching, sugarcane divisions. These expenses totaled $5.5
million during fiscal 2001 compared to $4.4 million during fiscal 2000 and
to $3.5 million during fiscal 1999.
General Corporate
_________________
The Company is continuing its marketing and permitting activities for its
land which surrounds the Florida Gulf Coast University site. There are
sales contracts in place for more than 7,400 acres of the Lee County,
Florida property totaling $167 million. The agreements are at various
stages of the due diligence periods with closing dates over the next ten
years.
The Company announced the formation of Agri-Insurance Company, Ltd. (Agri)
a wholly owned subsidiary, during July of 2000. The insurance company was
initially capitalized by transferring cash and approximately 3,000 acres of
the Lee County property (along with sales contracts totaling $8 million).
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. The Federal Crop Insurance Program provides
coverage for certain perils e.g. freeze damage, windstorm, disease, etc.
However, the current Federal Crop Insurance Program does not provide
business interruption coverage. The coverages contemplated by Agri
would indemnify the insured for the loss of the revenue stream resulting
from a catastrophic event that would cause a grove to be replanted. The
insurance market is bifurcated into insurers and reinsurers. Reinsurers
provide wholesale insurance coverage to the industry. Some specialized
reinsurers will only deal with insurance companies. As a result, the
only way to access the wholesale insurance market is through the formation
of a captive insurance company. Reinsurers provide greater insurance
coverage flexibility than can be found in the primary insurance market.
Agri is a newly created entity. It would be difficult, if not impossible,
to speculate about the impact that Agri could have on our financial
position, results of operations and liquidity in future periods. Since
the coverages that will be written, as liquidity is generated, will be
primarily for the benefit of Alico, the financial substance of this
venture is to insure risk that is inherent in the Company's existing
operations. To expedite the creation of the capital liquidity
necessary to underwrite the Company's exposure to catastrophic
losses, another 5,600 acres was transferred during fiscal 2001. Agri
underwrote a limited amount of coverage during fiscal 2001, and is
expected to begin writing more significant coverages before the end
of December 2001. As Agri gains underwriting experience and increases
its liquidlity, it will be able to increase its insurance program.
During September of 1999, the Company announced a sale of 1,270 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 payable over the next four years. In July
of 2000, Agri sold another 488 acres to the same buyer, also near the
University, for $10.6 million. In connection with the sale, the purchaser
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,
with the balance 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 was
recognized during fiscal 2000, 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 were recognized during the current fiscal
year upon receipt of the first annual mortgage payment which, combined
with the initial payment in fiscal 2000, exceeded 20% of the contract price.
Critical Accounting Policies and Estimates
__________________________________________
The preparation of our financial statements and related disclosures in
conformity with accounting principles generally accepted in the United States
of America requires management to make estimates and judgments that affect our
reported amounts of assets and liabilities, revenues and expenses, and related
disclosures of contingent assets and liabilities. On an on-going basis, we
evaluate our estimates and assumptions based upon historical experience and
various other factors and circumstances. Management believes that our estimates
and assumptions are reasonable in the circumstances; however, actual results
may vary from these estimates and assumption under different future
circumstances. We have identified the following critical accounting policies
that affect the more significant judgments and estimates used in the
preparation of our consolidated financial statements.
Alico records inventory at the lower of cost or market. Management regularly
assesses estimated inventory valuations based on current and forecasted
usage of the related commodity and any other relevant factors that affect
the net realizable value.
Based on fruit buyers' and processors' advances to growers, stated cash and
futures markets combined experience in the industry, management reviews the
reasonableness of citrus revenue accrual. Adjustments are made throughout
the year to these estimates as relevant information regarding the citrus
market becomes available. 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, $1,839,642, and $159,748 during fiscal 2001, 2000, and
1999, respectively.
In accordance with Statement of Position 85-3 "Accounting by Agricultural
Producers and Agricultural Cooperatives", the cost of growing crops (citrus
and sugarcane) are capitalized into inventory until the time of harvest. Once
a given crop is harvested, the related inventoried costs are recognized as
a cost of sale to provide an appropriate matching of costs incurred with the
related revenue earned.
Item 7(a). Quantitative and Qualitative Disclosure About Market Risk
_________________________________________________________________________
Our exposure to market rate risk for changes in interest rates relates
primarily to our investment portfolio. We do not have derivative financial
instruments in our investment portfolio. We place our investments with high
quality issuers and, by policy, limit the amount of credit exposure to any
one issuer. We are adverse to principal loss and ensure the safety and
preservation of our invested funds by limiting default, market and
reinvestment risk. We classify our cash equivalents and short-term
investments as fixed-rate if the rate of return on such instruments remains
fixed over their term. These fixed-rate investments include fixed-rate U.S.
government securities, municipal bonds, time deposits and certificates of
deposit. We classify our cash equivalents and short-term investments as
variable-rate if the rate of return on such investments varies based on the
change in a predetermined index or set of indices during their term. These
variable-rate investments primarily include money market accounts, mutual
funds and equities held at various securities brokers and investment banks.
The table below presents the amounts (in thousands) and related weighted
interest rates of our investment portfolio at August 31, 2001:
Average Interest Estimated
Marketable Securities and Rate Cost Fair Value
Short-term Investments (1) ________________ _____________ ___________
Fixed Rate 5.92% $ 3,098 $ 3,131
Variable Rate 2.45% $ 14,232 $ 15,596
(1) See definition in Notes 1 and 2 to our Notes to Consolidated Financial
Statements.
The aggregate fair value of our investment in debt instruments (net of mutual
funds of $1,426) as of August 31, 2001, by contractual maturity date,
consisted of the following:
Aggregate Fair
Values
______________
(in thousands)
Due in one year or less $ 68
Due between one and five years 100
Due between five and ten years 242
Due thereafter 1,262
______________
$ 1,672
______________
______________
Item 8. Financial Statements and Supplementary Data.
_____________________________________________________________
Independent Auditors' Report
____________________________
The Stockholders and Board of Directors
Alico, Inc.:
We have audited the consolidated balance sheets of Alico, Inc. and
subsidiaries as of August 31, 2001 and 2000, and the related consolidated
statements of operations, stockholders' equity, and cash flows for each of
the years in the three-year period ended August 31, 2001. In connection with
our audits of the consolidated financial statements, we also have audited
the related consolidated financial statement schedules as listed in Item
14(a)(2) herein. These consolidated financial statements and financial
statements schedules are the responsibility of the Company's management.
Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Alico,
Inc. and subsidiaries at August 31, 2001 and 2000, and the results of their
operations and their cash flows for each of the years in the three-year
period ended August 31, 2001 in conformity with accounting principles
generally accepted in the United States of America. Also in our opinion,
the related consolidated financial statement schedules, when considered
in relation to the consolidated financial statements taken as a whole,
present fairly, in all material respects, the information set forth therein.
KPMG LLP
(Signature)
Orlando, Florida
October 12, 2001
CONSOLIDATED BALANCE SHEETS
August 31,
2001 2000
_____________ ____________
ASSETS
Current assets:
Cash, including time deposits and other
cash investments of $478,260 in 2001
and $179,311 in 2000 $ 6,225,088 $ 1,796,428
Marketable securities available for
sale, at estimated fair value in
2001 and in 2000 (Note 2) 18,726,723 18,055,099
Accounts receivable ($6,901,275 in 2001 and
$7,717,325 in 2000 due from affiliate)
(Note 10) 10,153,205 11,954,721
Mortgages and notes receivable, current
portion (Note 3) 2,482,454 2,509,034
Inventories (Note 4) 23,246,609 21,915,039
Other current assets 510,760 348,062
____________ ____________
Total current assets 61,344,839 56,578,383
____________ ____________
Other assets:
Land inventories 8,031,544 7,147,937
Mortgages and notes receivable, net of
current portion (Note 3) 5,112,309 7,334,579
Investments 1,170,898 959,252
____________ ____________
Total other assets 14,314,751 15,441,768
____________ ____________
Property, buildings and equipment (Note 5) 138,352,300 136,822,381
Less accumulated depreciation (34,878,310) (31,966,492)
____________ ____________
Net property, buildings and equipment 103,473,990 104,855,889
____________ ____________
Total assets $179,133,580 $176,876,040
____________ ____________
____________ ____________
See accompanying Notes to Consolidated Financial Statements.
August 31,
2001 2000
____________ ____________
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,810,094 $ 2,429,242
Due to profit sharing plan (Note 8) 443,942 429,784
Accrued ad valorem taxes 1,383,111 1,780,807
Current portion of notes payable (Note 6) 1,301,146 1,298,890
Accrued expenses 1,494,940 988,011
Income taxes payable 22,670 4,169,517
Deferred income taxes (Note 9) 1,234,697 1,250,026
____________ ____________
Total current liabilities 7,690,600 12,346,277
Deferred revenue 52,987 9,540,000
Notes payable (Note 6) 46,704,954 40,302,855
Deferred income taxes (Note 9) 11,909,252 10,889,095
Deferred retirement benefits (Note 8) 150,429 252,809
____________ ____________
Total liabilities 66,508,222 73,331,036
____________ ____________
Stockholders' equity:
Preferred stock, no par value. Authorized
1,000,000 shares; issued, none - -
Common stock, $1 par value. Authorized
15,000,000 shares; issued and outstanding
7,044,513 in 2001 and 7,027,827 in 2000 7,044,513 7,027,827
Additional paid in capital 331,617 17,885
Accumulated other comprehensive income 871,077 1,159,445
Retained earnings 104,378,151 95,339,847
____________ ____________
Total stockholders' equity 112,625,358 103,545,004
____________ ____________
Total liabilities and stockholders'
equity $179,133,580 $176,876,040
____________ ____________
____________ ____________
See accompanying Notes to Consolidated Financial Statements.
CONSOLIDATED STATEMENTS OF OPERATIONS
Years Ended August 31,
2001 2000 1999
___________ ___________ ___________
Revenue:
Citrus (including revenues from
affiliate (Note 10) $27,569,705 $28,172,057 $23,518,082
Sugarcane 11,939,228 8,501,549 7,119,976
Ranch 9,299,477 6,062,224 6,270,988
Forest products 90,861 84,104 136,372
Rock and sand royalties 1,725,997 1,319,525 1,349,856
Oil lease and land rentals 770,170 923,535 710,731
Retail land sales 137,950 144,250 39,750
___________ __________ ___________
Total revenue 51,533,388 45,207,244 39,145,755
___________ __________ ___________
Costs of sales:
Citrus production, harvesting and
marketing (including charges from
affiliate (Note 10)) 22,450,086 21,431,441 21,077,169
Sugarcane production, harvesting
and hauling 9,317,739 6,962,366 4,483,250
Ranch 7,704,467 5,323,002 6,280,000
Retail land sales 140,102 126,012 92,029
__________ ___________ ___________
Total costs of sales 39,612,394 33,842,821 31,932,448
__________ ___________ ___________
Gross profit 11,920,994 11,364,423 7,213,307
Other, General and administrative
expenses 5,471,128 4,415,614 3,508,845
__________ ___________ ___________
Income (loss) from operations 6,449,866 6,948,809 3,704,462
Other income (expenses):
Profit on sales of real estate:
Sales 12,840,652 27,575,329 4,506,667
Cost of sales 1,486,282 4,754,645 606,983
___________ ___________ ___________
Gross profit 11,354,370 22,820,684 3,899,684
Gross profit not yet
recognized - 9,540,000 -
___________ ___________ ___________
Profit on sales of
real estate, net 11,354,370 13,280,684 3,899,684
Interest and investment income 2,123,595 3,093,203 1,301,991
Recovery of citrus eradication costs
in excess of basis (Note 13) 2,967,950 234,920 -
Interest expense (Note 6) (3,028,631) (3,019,819) (2,085,065)
Other income 245,165 37,177 239,866
___________ ___________ ___________
Total other income, net 13,662,449 13,626,165 3,356,476
___________ ___________ ___________
Income before income taxes 20,112,315 20,574,974 7,060,938
Provision for income taxes (Note 9) 4,046,184 6,464,358 2,980,214
___________ ___________ ___________
Net Income 16,066,131 $14,110,616 $ 4,080,724
___________ ___________ ___________
___________ ___________ ___________
Weighted-average number of shares
outstanding 7,032,929 7,027,827 7,027,827
___________ ___________ ___________
___________ ___________ ___________
Weighted-average number of dilutive
shares outstanding 7,057,395 7,031,861 7,032,432
___________ ___________ ___________
___________ ___________ ___________
Per share amounts:
Basic $ 2.29 $ 2.01 $ .58
Fully diluted $ 2.28 $ 2.01 $ .58
Dividends $ 1.00 $ .30 $ .50
See accompanying Notes to Consolidated Financial Statements.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Accumulated
Common Stock Other Additional
Shares Retained Comprehensive Paid in
Issued Amount Earnings Income Capital Total
________ __________ ___________ _______ ________ ________
Balances,
August 31,
1998 7,027,827 $7,027,827 $82,770,769 $168,345 $ - $89,966,941
_________
Comprehensive
income:
Net income
for the year
ended
August 31, 1999 - - 4,080,724 - - 4,080,724
Unrealized gains
on securities,
net of taxes - - - 861,608 - 861,608
and reclass-
ification adjustment __________
Total comprehensive
income: 4,942,332
Dividends paid - - (3,513,914) - - (3,513,914)
_________ _________ ___________ ________ _____ ___________
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 - - - 129,492 - 129,492
and reclass-
ification adjustment ___________
Total comprehensive
income: 14,240,108
Dividends paid - - (2,108,348) - - (2,108,348)
Stock based
compensation - - - - 17,885 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 year
ended
August 31, 2001 - - 16,066,131 - - 16,066,131
Unrealized losses
on securities,
net of taxes - - - (288,368) - (288,368)
and reclass-
ification adjustment ___________
Total comprehensive income: 15,777,763
Dividends paid - - (7,027,827) - - (7,027,827)
Stock options
exercised 16,686 16,686 - - 227,264 243,950
Stock based
compensation - - - - 86,468 86,468
_________ _________ _________ _______ _________ ___________
Balances,
August 31,
2001 7,044,513 $7,044,513$104,378,151 $871,077 $331,617 $112,625,358
_________ __________ ___________ ________ ________ ___________
_________ __________ ___________ ________ ________ ___________
Disclosure of reclassification amount: 2001 2000 1999
________ __________ ________
Unrealized holding gains (losses)
arising during the period $ (206,715) $2,176,940 $824,144
Less: reclassification adjustment
for gains (losses) included in net
income 81,653 2,047,448 (37,464)
________ __________ _________
Net unrealized gains
(losses) on securities $ (288,368) $ 129,492 $ 861,608
_________ _________ _________
_________ _________ _________
See accompanying Notes to Consolidated Financial Statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended August 31,
2001 2000 1999
___________ ___________ __________
Increase (Decrease) in Cash and Cash Investments:
Cash flows from operating activities:
Net income $16,066,131 $14,110,616 $ 4,080,724
Adjustments to reconcile net income
to cash provided by operating activities:
Depreciation and amortization 6,946,005 5,118,854 5,355,450
(Gain) loss on breeding herd sales (76,993) 99,766 (316,700)
Deferred income tax expense, net 1,178,810 (613,097) (631,748)
Deferred retirement benefits (102,380) (124,678) 374,167
Net gain on sale of marketable
securities (159,830) (1,868,010) (11,736)
Loss on sale of property
and equipment 1,641,938 1,232,535 33,934
Gain on real estate sales (11,585,627) (13,967,688) (4,299,434)
Stock options granted below fair
market value 86,468 17,885 -
Cash provided by (used for) changes in:
Accounts receivable 1,846,507 (3,930,668) 3,062,972
Inventories (1,701,762) (2,214,387) (3,824,055)
Income taxes refundable - - (549,586)
Other assets (600,335) (201,767) 138,673
Accounts payable and accrued
expenses (112,219) 161,824 1,893,878
Income taxes payable (4,146,847) 4,719,103 (623,128)
Deferred revenues 52,987 - (345,763)
___________ ___________ ___________
Net cash provided by operating
activities 9,332,853 2,540,288 4,337,648
___________ ___________ ___________
Cash flows from investing activities:
Increase in land inventories (924,851) (713,832) (591,338)
Purchases of property and
equipment (8,502,483) (9,995,159) (27,883,421)
Proceeds from disposals of
property and equipment 959,324 522,091 457,584
Proceeds from sale of real
estate 2,880,279 17,089,222 4,466,917
Purchases of investments (211,646) (69,937) (39,165)
Proceeds from the sale of
other assets - 56,829 58,250
Purchases of marketable
securities (3,013,303) (2,902,598) (3,461,686)
Proceeds from sales of
marketable securities 2,039,159 1,967,397 2,140,932
Issuances of mortgages and
notes receivable (381,425) (85,080) -
Collection of mortgages and
notes receivable 2,630,275 105,926 146,677
___________ __________ ___________
Net cash provided by
(used for) investing
activities (4,524,671) 5,974,859 (24,705,250)
___________ ___________ ___________
Years Ended August 31,
2001 2000 1999
___________ ___________ ___________
Cash flows from financing activities:
Proceeds from exercising
stock options 243,950 - -
Proceeds from bank loans 43,193,828 33,086,000 59,952,000
Repayment of bank (36,789,473) (38,437,200) (36,237,923)
Dividends paid (7,027,827) (2,108,348) (3,513,914)
___________ ___________ ___________
Net cash provided by
(used for) financing
activities (379,522) (7,459,548) 20,200,163
___________ ___________ ___________
Net increase (decrease) in
cash and cash investments 4,428,660 1,055,599 (167,439)
Cash and cash investments:
At beginning of year 1,796,428 740,829 908,268
___________ ___________ __________
At end of year $ 6,225,088 $ 1,796,428 $ 740,829
___________ ___________ ___________
___________ ___________ ___________
Supplemental disclosures of cash flow information:
Cash paid for interest,
net of amount capitalized $ 3,101,692 $ 2,863,215 $ 2,186,855
___________ ___________ ___________
___________ ___________ ___________
Cash paid for income taxes, $ 7,014,227 $ 2,472,505 $ 3,142,286
including related interest (Note 9)___________ ___________ ___________
___________ ___________ ___________
Noncash investing activities:
Fair value adjustments to
securities available for sale $ (462,350) $ 208,175 $ 1,482,456
___________ ___________ ___________
___________ ___________ ___________
Income tax effect related
to fair value adjustments $ (173,982) $ 78,336 $ 557,848
___________ ___________ ___________
___________ ___________ ___________
Reclassification of breeding
herd to Property & Equipment $ 370,192 $ 989,896 $ 902,763
___________ ___________ ___________
___________ ___________ ___________
See accompanying Notes to Consolidated Financial Statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years Ended August 31, 2001, 2000 and 1999
(1) Summary of Significant Accounting Policies
__________________________________________
(a) Basis of Consolidated Financial Statement Presentation
______________________________________________________
The consolidated financial statements include the accounts of
Alico, Inc. (the Company) and its wholly owned subsidiaries,
Saddlebag Lake Resorts, Inc. (Saddlebag), and Agri-Insurance
Company, Ltd. (Agri), after elimination of all significant
intercompany balances and transactions.
(b) Revenue Recognition
___________________
Income from sales of citrus under marketing pool agreements is
recognized at the time the crop is harvested. The revenue is
based on the Company's estimates of the amounts to be received as
the sales of pooled products are completed. Based on fruit buyers'
and processors' advances to growers, stated cash and futures
markets, management reviews the reasonableness of the citrus
revenue accrual. Adjustments are made throughout the year to these
estimates as relevant information regarding the citrus market
becomes available. 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, $1,839,642, and
$159,748 during fiscal years 2001, 2000 and 1999, respectively.
Revenue from sugarcane is recognized when the harvested product is
taken for processing. The earnings process is complete at that
time and the resulting revenue is determinable for the sugarcane
crop as of year-end, therefore, no estimations are necessary.
The Company recognizes revenue from cattle sales at the time the
cattle are sold at auction.
(c) Real Estate
___________
Real estate sales are recorded under the accrual method of
accounting. Residential retail land sales made through Saddlebag
are not recognized until payments received, including interest,
aggregate the buyer's initial investment or cumulative payments
of principal and interest equal or exceed 10 percent of the
contract sales price for residential real estate or 20 percent
for commercial real estate. Commercial or bulk land sales, made
through Agri, are not recognized until payments received for
property to be developed within two years after the sale equal
20%, or property to be developed after two years equal 25%,
of the contract sales price. At August 31, 2000, the Company had
deferred revenue of did not recognize gross profit totaling
$9,540,000 related to commercial real estate which was sold
subject to a mortgage note receivable (note 3). The terms
of the sale called for 10% of the contract price of
$10,600,000 to be paid at closing. The $1,060,000 less
the land basis and closing costs was recognized as a gain on the
sale of real estate totaling $287,880 during August 31, 2000.
During the year ended August 31, 2001, the purchaser made the
first of four equal annual installments, required in the mortgage,
totaling $2,385,000, plus interest. The deferred profit on the
sale was then recognized as 32.5 percent of the contract
price was received and the buyer's continuing investment became
adequate to demonstrate its commitment to pay for the property.
Sales Profits from commercial real estate sales are discounted
to yield reflect the market rate of interest where the stated
rate is less than the market rate. The recorded valuation
discounts are realized as the balances due are collected.
In the event of early liquidation, interest is recognized on
the simple interest method.
Tangible assets that are purchased during the period to aid in
the sale of the project as well as costs for services performed
to obtain regulatory approval of the sales are capitalized as
land and land improvements to the extent they are estimated to be
recoverable from the sale of the property. Land and land
improvement costs are allocated to individual parcels on a per
lot basis using the relative sales value method.
The Company has entered into an agreement with a real estate
consultant to assist in obtaining the necessary regulatory
approvals for the development and marketing of a tract of raw
land. The marketing costs under this agreement are being
expensed as incurred. The costs incurred to obtain the necessary
regulatory approvals are capitalized into land costs when paid.
These costs will be expensed as cost of sales when the underlying
real estate is sold.
(d) Marketable Securities Available for Sale
________________________________________
Marketable securities available for sale are carried at the
estimate fair value of the portfolio. Net unrealized investment
gains and losses are recorded net of related deferred taxes in a
separate component of stockholders' equity until realized.
Fair value for debt and equity investments is based on quoted
market prices at the reporting date for those or similar
investments. The cost of all marketable securities available for
sale are determined on the specific identification method.
(e) Inventories
___________
The costs of growing citrus and sugarcane are capitalized into
inventory until the time of harvest. Once a given crop is
harvested, the related inventoried costs are recognized as
a cost of sale to provide an appropriate matching of costs incurred
with the related revenue earned.
Beef cattle inventories are stated at the lower of cost or
market. The cost of the beef cattle inventory is based on the
accumulated cost of developing such animals for sale.
Unharvested crops are stated at the lower of cost or market. The
cost for unharvested crops is based on accumulated production
costs incurred during the eight month period from January 1
through August 31.
(f) Property, Buildings and Equipment
_________________________________
Property, buildings and equipment are stated at cost. Properties
acquired from the Company's predecessor corporation in exchange
for common stock issued in 1960, at the inception of the Company,
are stated on the basis of cost to the predecessor corporation.
Property acquired as part of a land exchange trust is valued at
the carrying value of the property transferred to the trust.
All costs related to the development of citrus groves, through
planting, are capitalized. Such costs include land clearing,
excavation and construction of ditches, dikes, roads, and
reservoirs, etc. After the planting, caretaking costs or
pre-productive maintenance costs are capitalized for four years.
After four years, a grove is considered to have reached maturity
and the accumulated costs, except for land excavation become
the depreciable basis of a grove and are written off over 25
years.
Development costs for sugarcane are capitalized the same as citrus.
However, sugarcane matures in one year and the Company is able
to harvest an average of 3 crops (1 per year) from one planting.
As a result, cultivation/caretaking costs are expensed as the
crop is harvested, while the appropriate development and planting
costs are depreciated over 3 years.
The breeding herd consists of purchased animals and animals
raised on the ranch. Purchased animals are stated at cost. The
cost of animals raised on the ranch is based on the accumulated
cost of developing such animals for productive use.
Depreciation for financial reporting purposes is computed on
straight-line and accelerated methods over the estimated useful
lives of the various classes of depreciable assets.
The Company accounts for long-lived assets in accordance with
the provisions of SFAS No. 121, "Accounting for the Impairment
of Long-Lived Assets for Long-Lived Assets to be Disposed of".
This Statement requires the long-lived assets and certain
identifiable intangibles be reviewed for impairment whenever
events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable. Recoverability of
assets to be held and used is measured by a comparison of the
carrying amount of an asset to future net cash flows expected
to be generated by the asset. If such are considered to be
impaired, the impairment to be recognized is measured by the
amount by which the carrying amount of the assets exceeds the
fair value of the assets. Assets to be disposed of are reported
at the lower of the carrying amount or fair value less costs to
sell.
(g) Land Inventories
___________________
Land inventories are carried at cost and consists of property
located in Lee County, Florida and owned by Agri-Insurance Co.,
Ltd. The property is held for sale as commercial real estate.
-
(h) Other Investments
___________________
Other investments are carried at cost which primarily includes
stock owned in cooperatives. The Company uses
cooperatives to process and sell sugarcane and cattle.
Cooperatives typically require members to acquire ownership
as a term of use of its services.
(i) Income Taxes
____________
The Company accounts for income taxes under the asset and
liability method. Under this method, deferred tax assets and
liabilities are recognized for the future tax consequences
attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are
expected to be recovered or settled. The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in
income in the period that includes the enactment date.
(j) Basic Net Earnings Per Share
________________________
Earnings per share has been computed by dividing net income by
the weighted average number of common shares outstanding during
the year. The Company has no had 7,057,395 shares of dilutive
securities. Outstanding stock options issued by the Company
represent the only dilutive effect reflected in diluted weighted
average shares outstanding. Options do not impact the numerator
of the diluted earnings per share computation.
There were no stock options that could potentially dilute basic
earnings per share in the future that were not included in the
computation of diluted earnings per share because to do so would
have been antidilutive for the periods presented.
(k) Cash Flows
__________
For purposes of the cash flows, cash and cash investments include
cash on hand and amounts due from financial institutions with an
original maturity of less than three months.
(l) Use of Estimates
________________
In preparing the consolidated financial statements, management is
required to make estimates and assumptions that effect the
reported amounts of assets and liabilities. Actual results could
differ significantly from those estimates. Although some
variability is inherent in these estimates, management believes
that the amounts provided are adequate.
(m) Financial Instruments and Accruals
__________________________________
The carrying amounts in the consolidated balance sheets for
accounts receivable, mortgage and notes receivable, accounts
payable and accrued expenses approximate fair value, because
of the immediate or short term maturity of these items.
The carrying amounts reported for the Company's long-term
debts approximate fair value.
(n) Derivative and Hedging Instruments
__________________________________
In June 1998, the Financial Accounting Standards Board ("FASB")
issued SFAS No. 133, "Accounting for Derivative Instruments and
Hedging Activities", which establishes accounting and reporting
standards for derivative instruments, including certain derivative
instruments embedded in other contracts (collectively referred
to as derivatives), and for hedging activities. SFAS No. 133 was
amended by SFAS No. 138 in June 2000, in part, to allow "normal
purchases and normal sales" transactions to be excluded from
SFAS 133. At September 1, 2000, the Company had no open
derivatives. Accordingly, the Company's adoption of the provisions
of SFAS No. 133, as amended, on September 1, 2000, did not result in
a transition adjustment.
The Company engages in cattle futures trading activities for the
purpose of economically hedging against price fluctuations. The
Company records gains and losses related to economic hedges in
costs of goods sold. At August 31, 2001, the Company had no
open positions.
(o) Accumulated Other Comprehensive Income
______________________________________
Comprehensive income is defined as the change in equity of
a business enterprise during a period from transactions and
other events and circumstances from non-owner sources.
It includes both net income and other comprehensive income.
Items included in other comprehensive income are classified
based on their nature. The total of other comprehensive income
for a period has been transferred to an equity account and
displayed as "accumulated other comprehensive income".
(p) Stock-Based Compensation
________________________
The Company applies Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB 25) for stock
options and other stock-based awards while disclosing pro forma
net income and net income per share as if the fair value method
had been applied in accordance with Statement of Financial
Accounting Standards No. 123,"Accounting for Stock-based
Compensation" (SFAS 123).
(q) Reportable Operating Segments
_________________
Alico, Inc. The Company has three four reportable segments: citrus,
sugarcane, and ranch 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 all located
in Florida. The citrus segment produces fruit for both the fresh
fruit and processed juice markets. The sugarcane segment produces
sugarcane for processing. The ranch segment raises beef cattle to be
sold in the wholesale market.
The Company's reportable segments are strategic business units that
offer different products. They are managed separately because each
business requires different operating strategies.
(r) Reclassifications
_________________
Certain amounts from 2000 have been reclassified to conform to the
2001 presentation.
(2) Marketable Securities Available for Sale
________________________________________
The Company has classified 100% of its investments in marketable
securities as available for sale and, as such, the securities are
carried at estimated fair value. Any unrealized gains and losses,
net of related deferred taxes, are recorded as a net amount in a
separate component of stockholders' equity until realized.
The cost and estimated fair values of marketable securities available
for sale at August 31, 2001 and 2000 (in thousands) were as follows:
2001 2000
_____________________________ _____________________________
Gross Estimated Gross Estimated
Unrealized Fair Unrealized Fair
Cost Gains Losses Value Cost Gains Losses Value
_______ ____ ____ _______ ______ ______ ___ ________
Equity
securities $14,232 $1,364 $ (-) $15,596 $13,107 $2,260 $(284) $15,083
Debt
securities 3,098 82 (49) 3,131 3,089 16 (133) 2,972
_______ ____ _____ _______ ______ ______ ___ _______
Marketable
securities
available
for sale $17,330 $1,446 $ (49)$18,727 $16,196 $2,276 $ (417) $18,055
_______ _____ _____ _______ ______ ______ ____ _______
_______ _____ _____ _______ ______ ______ ____ _______
At August 31, 2001, debt instruments (net of mutual funds of $1,426,046)
are collectible as follows:$67,968 within one year, $100,250 between one
and five years, $241,850 between five and ten years, and $1,261,609 there
after.
(3) Mortgage and Notes Receivable
____________________________
Mortgage and notes receivable arose from real estate sales. The balances
(in thousands) are as follows:
August 31, 2001 August 31, 2000
_______________ _______________
Mortgage notes receivable
on retail land sales $ 242 $ 239
Mortgage notes receivable
on bulk land sales 7,262 9,540
Other notes receivable 90 65
________________ _______________
Total mortgage and notes
receivable $ 7,594 $ 9,844
Less current portion 2,482 2,509
________________ _______________
Non-current portion $ 5,112 $ 7,335
________________ _______________
________________ _______________
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 four
years.
(4) Inventories
___________
A summary of the Company's inventories (in thousands) at August 31,
2001 and 2000 is shown below:
2001 2000
_______ _______
Unharvested fruit crop on trees $ 9,626 $ 9,160
Unharvested sugarcane 5,387 5,096
Beef cattle 8,076 7,470
Sod 158 189
_______ _______
Total inventories $23,247 $21,915
_______ _______
_______ _______
(5) Property, Buildings and Equipment
_________________________________
A summary of the Company's property, buildings and equipment (in
thousands) at August 31, 2001 and 2000 is shown below:
Estimated
2001 2000 Useful Lives
_______ _______ ____________
Breeding herd $12,465 $13,713 5-7 years
Buildings 3,806 3,571 5-40 years
Citrus trees 25,328 25,839 22-40 years
Sugarcane 8,378 7,651 4-15 years
Equipment and other facilities 29,993 27,670 3-40 years
_______ _______
Total depreciable properties 79,970 78,444
Less accumulated depreciation 34,878 31,966
_______ _______
Net depreciable properties 45,092 46,478
Land and land improvements 58,382 58,378
_______ _______
Net property, buildings
and equipment $103,474 $104,856
_______ _______
_______ _______
The Company's citrus trees, fruit crop, unharvested sugarcane and
cattle are partially uninsured.
(6) Indebtedness
____________
The Company has financial 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 2003 and up to
$3 million which is due on demand. The outstanding debt under these
agreements was $31.8 million and $24.1 million at August 31, 2001 and
2000, respectively. 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 August 31, 2001 and 2000 was
$46,704,954 and $40,302,855, respectively.
Maturities of the indebtedness of the Company over the next five years are
as follows: 2002- $1,301,146; 2003- $18,072,386; 2004- $1,306,142;
2005- $1,308,905; 2006- $1,311,862.
Interest cost expensed and capitalized (in thousands) during the three
years ended August 31, 2001, 2000 and 1999 was as follows:
2001 2000 1999
______ ______ ______
Interest expense $3,029 $3,020 $2,085
Interest capitalized 175 431 158
______ ______ ______
Total interest cost $3,204 $3,451 $2,243
______ ______ ______
______ ______ ______
(7) 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 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, 1999 34,700 $14.42 8
Granted 14,992 $14.62 _______________
______ _________ _______________
Balance outstanding,
August 31, 2000 46,692 14.62 9
_______________
Granted 51,074 14.62 _______________
Exercised 16,686 14.62
______ _________
Balance outstanding,
August 31, 2001 84,080 $14.62 10
______ _________ _______________
______ _________ _______________
On August 31, 2001 and 2000, there were 549,234 and 600,308 shares
available for grant, respectively.
The fair value of stock options granted was $78,858 in 2001 and
$15,667 in 2000 on the date of the grant using the Black Scholes
option-pricing model with the following weighted average
assumptions:
2001 2000
____ ____
Volatility 10.19% 7.26%
Dividend paid 6.84% 6.84%
Risk-free interest rate 5.75% 5.75%
Expected life in years 1 1
All stock options granted, except as noted in the paragraph below,
have been granted to directors or employees with an exercise price
equal to the fair value of the common stock at the date of the grant.
The Company applies APB Opinion No. 25 for issuances to directors
and employees in accounting for its Plan. No compensation cost has
been recognized in the consolidated financial statements through
August 31, 1999, as options were issued at or above fair value.
On September 9, 1999, the Company granted 14,992 stock options with
an exercise price of $14.62 and a fair value of $15.813. The
Company recorded $17,885 of unearned compensation at the date of
the grant. On September 12, 2000, the Company granted an additional
51,074 stock options with an exercise price of $14.62 and a fair
value of $16.313. The Company recorded $86,468 of unearned compen-
sation at the date of the grant.
Had the Company determined compensation cost based on the fair value
at the grant date for its stock options under SFAS No. 123, the
Company's net income would have changed to the pro forma amounts
indicated below:
2001 2000
____ ____
Net income as reported $16,066,131 $14,110,616
Pro forma net income $16,073,741 $14,112,834
Basic earning per share, as reported $ 2.29 $ 2.01
Pro forma basic earning per share $ 2.29 $ 2.01
(8) Employee Benefit Plans
______________________
The Company has a profit sharing plan covering substantially all
employees. The plan was established under Internal Revenue Code Section
401(k). Contributions made to the profit sharing plan were $443,942,
$429,784 and $269,177 for the years ended August 31, 2001, 2000 and 1999,
respectively.
Additionally, the Company implemented a nonqualified defined benefit
retirement plan covering the officers and other key management personnel
of the Company. The plan is being funded by the purchase of insurance
contracts. The accrued pension liability for the nonqualified defined
benefit retirement plan at August 31, 2001 and 2000 was $147,108 and
$249,488, respectively.
Pension expenses for the additional retirement benefits were
approximately $395,000, $128,000 and $213,000 for the years ended
August 31, 2001, 2000 and 1999, respectively.
(9) Income Taxes
____________
The provision for income taxes (in thousands) for the years ended
August 31, 2001, 2000 and 1999 is summarized as follows:
2001 2000 1999
______ ______ ______
Current:
Federal income tax $2,428 $6,218 $3,311
State income tax 439 860 300
______ ______ ______
2,867 7,078 3,611
______ ______ ______
Deferred:
Federal income tax 1,058 (528) (539)
State income tax 121 (86) ( 92)
______ ______ ______
1,179 (614) (631)
______ ______ ______
Total provision for
income taxes $4,046 $6,464 $2,980
______ ______ ______
______ ______ ______
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 (in thousands) for the years ended August 31, 2001, 2000 and
1999:
2001 2000 1999
______ ______ ______
Expected income tax $6,838 $6,995 $2,401
Increase (decrease)
resulting from:
State income taxes, net
of federal benefit 328 516 135
Nontaxable interest
and dividends (113) (127) (102)
Internal Revenue Service
examinations 479 (352) 984
Change in valuation
allowance - - (539)
Utilization of
charitable
contribution
carryforward - (136) -
Income from Agri-
Insurance
Company, Ltd. (3,829) - -
Other reconciling
items, net 343 (432) 101
______ ______ ______
Total provision for
income taxes $4,046 $6,464 $2,980
______ ______ ______
______ ______ ______
Some items of revenue and expense included in the statement of operations
may not be currently taxable or deductible on the income tax returns.
Therefore, income tax assets and liabilities are divided into a current
portion, which is the amount attributable to the current year's tax return,
and a deferred portion, which is the amount attributable to another year's
tax return. The revenue and expense items not currently taxable or
deductible are called temporary differences.
The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities are
presented below (in thousands):
2001 2000
_______ _______
Deferred Tax Assets:
Pension (168) (171)
Prepaid sales commissions (776) (875)
Inventory-beef (376) (416)
Land inventories (435) (300)
Other (1,246) (1,649)
_______ _______
Total gross deferred
tax assets (3,001) (3,411)
_______ _______
Deferred Tax Liabilities:
Revenue recognized from
citrus and sugarcane 861 654
Property and equipment
(principally due to
depreciation and soil
and water deductions) 12,390 12,814
Mortgage notes receivable 117 27
A/R citrus 671 546
Other 1,580 809
Unrealized gains on securities 526 700
_______ _______
Total gross deferred
tax liabilities 16,145 15,550
_______ _______
Net deferred income
tax liabilities $13,144 $12,139
_______ _______
_______ _______
Based on the Company's history of taxable earnings and its
expectations for the future, management has determined that its
taxable income will more likely than not be sufficient to fully
recognize all deferred tax assets.
Agri Insurance Company, Ltd. (Agri), a wholly owned insurance
company subsidiary of Alico, is treated as a U.S. taxpayer,
pursuant to an election under Internal Revenue Code Section 953
(d), for all purposes except for consolidating an operating loss
by virtue of the dual consolidated loss rules. (Dual consolidated
losses prevent operating losses (not capital losses) from
occurring in insurance companies domiciled outside of the United
States from offsetting operating income irrespective of the fact
that the insurance company is a member of the consolidated return
group.)
Agri was established to provide agricultural insurance that falls
outside of the Federal Crop Insurance Program, for catastrophic
perils. Agri was domiciled in Bermuda because it offers easy
access to reinsurance markets.
Agri issued its initial policy in August 2000 to a third party.
Agri's ability to underwrite insurance risks has been limited
to its operational liquidity, by the Registrar of Companies in
Bermuda. Agri will be able to underwrite additional insurance
as its liquidity is increased from additional asset sales and as
payments are received on prior sales. For Federal income tax
purposes, only premiums received by Agri from policies of
insurance issued to parties other than its parent, Alico, are
considered insurance premiums. The preceding limiting factors
resulted in Agri not incurring a tax liability on underwriting
profits or investment income. Agri's tax status resulted in
it filing its Federal tax return on a stand alone basis on a
calendar year period ending December 31, 2000. It should be
noted that during the fiscal year ending August 31, 2001, Agri
incurred an underwriting loss of approximately $212,000.
(10) Related Party Transactions
__________________________
Citrus
______
Citrus revenues of $19,908,087, $20,032,730 and $18,188,136 were
recognized for a portion of citrus crops sold under a marketing
agreement with Ben Hill Griffin, Inc. (Griffin) for the years
ended August 31, 2001, 2000 and 1999, respectively. Griffin and
its subsidiaries is the owner of approximately 50.78 percent of
the Company's common stock. Accounts receivable, resulting from
citrus sales, include amounts due from Griffin totaling
$6,901,275 and $7,717,325 at August 31, 2001 and 2000,
respectively. These amounts represent estimated revenues to
be received periodically under pooling agreements as the sale of
pooled products is completed.
Harvesting, marketing, and processing costs, related to the citrus sales
noted above, totaled $7,614,788, $7,531,491, and $6,127,603 for the years
ended August 31, 2001, 2000 and 1999, respectively. In addition, Griffin
provided the harvesting services for citrus sold to unrelated processors.
The aggregate cost of these services was $2,185,899, $1,987,660 and
$791,932 for the years ended August 31, 2001, 2000 and 1999,
respectively. The accompanying consolidated balance sheets include
accounts payable to Griffin for citrus production, harvesting and
processing costs in the amount of $414,126 and $616,430 at August 31,
2001 and 2000, respectively.
Other Transactions
__________________
The Company purchased fertilizer and other miscellaneous supplies,
services, and operating equipment from Griffin, on a competitive bid basis,
for use in its cattle, sugarcane, sod and citrus operations. Such
purchases totaled $6,029,491, $5,518,087 and $6,019,927 during the years
ended August 31, 2001, 2000 and 1999, respectively.
(11) Future Application of Accounting Standards
__________________________________________
In June 2001, the Financial Accounting Standard Board (FASB) issued
Financial Accounting Standards (SFAS) No. 141, "Business Combinations".
This statement addresses financial accounting and reporting for
business combinations and supersedes Accounting Principal Board (APB)
Option No. 16, "Business Combinations", and FASB Statement No. 38,
"Accounting for Preacquisition Contingencies of Purchased Enterprises".
All business combinations in the scope of this Statement are to be
accounted for using one method, the purchase method. The provisions
of this Statement apply to all business combinations initiated after
June 30, 2001. The Statement also applies to all business combinations
accounted for using the purchase method which the date of acquisition
is July 1, 2001, or later. Adoption of this Statement is not expected
to have a significant impact on the financial position or results of
operations of the Company.
In June 2001, the FASB issued SFAS No. 142, "Goodwill and Other
Intangible Assets". This Statement addresses financial accounting
and reporting for acquired goodwill and other intangible assets and
supersedes APB Opinion No. 17, "Intangible Assets". It addresses how
intangible assets that are acquired individually or with a group of
other assets (but not those acquired in a business combination)
should be accounted for in financial statements upon their acquisition.
This Statement also addresses how goodwill and other intangible assets
should be accounted for after they have been initially recognized in
the financial statements. Adoption of this Statement is not expected
to have a significant impact on the financial position or results of
operations of the Company.
In June 2001, the FASB issued SFAS No. 143 "Accounting for Asset
Retirement Obligations." This statement addresses financial
accounting and reporting for obligations associated with the
retirement of tangible long-lived assets and the associated
asset retirement costs. It applies to legal obligations associated
with the retirement of long-lived assets that result from the
acquisition, construction, development and (or) the normal operation
of a long-lived asset, except for certain obligations of lessees.
This Statement is effective for financial statements with fiscal
years beginning after June 15, 2002. Adoption of this Statement
is not expected to have a significant impact on the financial
position or results of operations of the Company.
In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." This Statement
addresses financial accounting and reporting for the impairment
or disposal of long-lived assets. This Statement supercedes
both FASB Statement No. 121, "Accounting for the Impairment of Long-
Lived Assets to Be Disposed Of" and the accounting and reporting
Provisions of Accounting Principles Board Opinion No. 30, "Reporting
the Results of Operations-Reporting the Effects of Disposal of a
Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactions of a Segment of a Business."
This Statement is effective for financial statements with fiscal
years beginning after December 15, 2001. Adoption of this Statement
is not expected to have a significant impact on the financial position
or results of operations of the Company.
(12) Commitments and Contingencies
_____________________________
The Company is involved in various claims and legal actions arising
in the ordinary course of business. In the opinion of management,
the ultimate disposition of these matters will not have a material
adverse effect on the Company's consolidated financial position,
results of operation or liquidity.
13) Recovery of Citrus Canker Eradication Costs in Excess of Basis
______________________________________________________________
The Company incurred losses during the years ended August 31, 2001
and 2000, related to citrus canker eradication. The eradication
program called for the removal of 507 acres of citrus trees from
a grove in Hendry County, Florida. While the trees were insured
under the Federal Crop Insurance Program, additional relief funding
was available and secured by the Company from both Federal and State
government sources. A summary of the recovery sources, related
basis of the trees removed and the crop inventory losses are
summarized (in thousands) as follows:
2001 2000
______ ______
Recovery Sources
Federal $ 2,830 $ 1,423
State 157 -
Insurance 219 383
______ ______
Total Recovery 3,206 1,806
Loss Basis
Net Book Value of Trees 238 1,222
Fruit Inventory - 349
______ ______
Total Basis 238 1,571
______ ______
Excess of Recovery over Basis $ 2,968 $ 235
______ ______
______ ______
14) Business Reportable Segment Information
____________________________
The Company is primarily engaged in agricultural operations, which
are subject to risk, including market prices, weather conditions and
environmental concerns. The Company is also engaged in retail land
sales and, from time to time, sells real estate considered surplus
to its operating needs. Information about the Company's operations
reportable segments (in thousands) for the years ended
August 31, 2001, 2000 and 1999 is summarized as follows:
2001 2000 1999
________ ________ ________
Revenues from external customers:
Agriculture:
Citrus $ 27,570 $ 28,172 $ 23,518
Sugarcane 11,939 8,501 7,120
Ranch 9,299 6,062 6,271
________ ________ ________
Total agriculture revenues
from external customers
for reportable segments 48,808 42,735 36,909
Real estate
General corporate
Other revenues from
external customers 2,725 2,472 2,237
________ ________ ________
Consolidated totals
Total consolidated revenues $ 51,533 $ 45,207 $ 39,146
________ ________ ________
________ ________ ________
Costs of sales:
Citrus $ 22,450 $ 21,431 $ 21,077
Sugarcane 9,318 6,962 4,483
Ranch 7,704 5,323 6,280
________ ________ ________
Total costs of sales
for reportable segments 38,472 33,716 31,840
Other costs of sales 1,140 127 92
________ ________ ________
Total consolidated
costs of sales $ 39,612 $ 33,843 $ 31,932
________ ________ ________
________ ________ ________
2001 2000 1999
________ ________ ________
Operating income (loss) Gross profit:
Agriculture:
Citrus $ 5,120 $ 6,741 $ 2,441
Sugarcane 2,621 1,539 2,637
Ranch 1,595 739 (9)
________ ________ ________
Total agriculture profit
for reportable segments 9,336 9,019 5,069
Real estate
General corporate
Total operating income
Interest expense
General corporate expenses
Other gross profit 2,585 2,345 2,144
________ ________ ________
Income before
income taxes
Consolidated gross profit 11,921 11,364 7,213
________ ________ ________
Unallocated amounts:
Profit on sale of bulk
real estate 11,354 13,281 3,900
Other corporate expense (3,163) (4,070) (4,052)
________ ________ ________
Income before income taxes $ 20,112 $ 20,573 $ 7,061
________ ________ ________
________ ________ ________
Capital expenditures:
Agriculture:
Citrus $ 3,310 $ 1,331 $ 9,674
Sugarcane 2,632 5,861 13,995
Ranch 2,157 2,940 3,247
Sod
Farm lands
Heavy equipment
________ ________ ________
Total agriculture capital
expenditures for
reportable segments 8,099 10,132 26,916
General corporate
Other capital expenditures 773 853 1,870
Cattle transferred from
inventory held for sale
into breeding stock (370) (990) (903)
________ ________ ________
Total consolidated totals
capital expenditures $ 8,502 $ 9,995 $ 27,883
________ ________ ________
________ ________ ________
Depreciation, depletion and amortization:
Agriculture:
Citrus $ 2,405 $ 2,417 $ 2,273
Sugarcane 2,587 2,235 1,460
Ranch 1,456 (66) 1,174
Sod
Farm lands
Heavy equipment
________ ________ ________
Total agriculture depreciation,
depletion and amortization
for reportable segments 6,448 4,586 4,907
General corporate
Other depreciation, depletion,
and amortization 498 533 448
________ ________ ________
Consolidated totals
Total consolidated depreciation,
depletion and
amortization $ 6,946 $ 5,119 $ 5,355
________ ________ ________
________ ________ ________
Identifiable Assets:
Agriculture:
Citrus $ 53,266 $ 56,173 $ 55,156
Sugarcane 51,678 50,784 45,629
Ranch 22,205 21,765 19,306
Sod
Farm lands
Heavy equipment
________ ________ ________
Total agriculture assets for
reportable segments 127,149 128,722 120,091
Real estate
General corporate
Other assets 51,985 48,154 36,831
________ ________ ________
Consolidated totals
Total consolidated assets $179,134 $176,876 $156,922
________ ________ ________
________ ________ ________
Identifiable assets represents assets on hand at year-end which are
allocable to a particular segment either by their direct use or by
allocation when used jointly by two or more segments. General corporate
Other assets consist principally of cash, temporary investments,
mortgage notes receivable, bulk land inventories, and property and
equipment used in general corporate business.
SELECTED QUARTERLY FINANCIAL DATA
(UNAUDITED)
Summarized quarterly financial data (in thousands except for per share
amounts) for the years ended August 31, 2001 and August 31, 2000, is as
follows:
Quarters Ended
November 30, Feb. 28, May 31, August 31,
2000 1999 2001 2000 2001 2000 2001 2000
_______ _______ _______ _______ _______ _______ _______ ______
S>
Revenue:
Citrus $ 1,096 $ 1,703 $10,421 $ 9,170 $12,658 $10,118 $ 3,395 $7,182
Sugarcane 2,938 1,451 6,303 5,021 2,698 2,310 0 (281)
Ranch 4,800 2,987 951 582 2,156 1,668 1,392 825
Property
sales 195 12,860 1,025 132 515 2 9,850 1,118
Interest 502 770 230 1,566 215 912 1,177 (154)
Other
revenues 744 794 633 550 803 517 3,620 737
_______ _______ _______ _______ _______ _______ _______ ______
Total
revenue 10,275 20,565 19,563 17,021 19,045 15,527 19,434 9,427
_______ _______ _______ _______ _______ _______ _______ ______
Costs and expenses:
Citrus 835 1,075 9,425 8,527 9,396 8,818 2,794 3,011
Sugarcane 2,236 1,423 5,056 4,452 2,031 1,034 (5) 54
Ranch 4,315 2,900 918 524 1,446 1,428 1,025 472
Interest 729 632 980 777 647 663 673 947
Other 980 765 1,249 845 1,128 1,050 2,347 2,568
______ ______ ______ ______ ______ _____ _____ _____
Total costs
and ex-
penses 9,095 6,795 17,628 15,125 14,648 12,993 6,834 7,052
______ ______ ______ ______ ______ _____ _____ _____
Income be-
fore income
taxes 1,180 13,770 1,935 1,896 4,397 2,534 12,600 2,375
Provision for
income
taxes 375 5,158 644 644 1,425 1,064 1,602 (402)
______ ______ ______ ______ ______ ______ ______ _____
Net income $ 805 $8,612 $1,291 $1,252 $2,972 $1,470 $10,998 $2,777
______ ______ ______ ______ ______ ______ ______ _____
______ ______ ______ ______ ______ ______ ______ _____
Basic earnings
per share $ .11 $1.23 $ .18 $ .18 $ .42 $ .21 $ 1.58 $ .39
______ ______ ______ ______ ______ ______ ______ _____
______ ______ ______ ______ ______ ______ ______ _____
The weighted average number of shares outstanding totaled 7,027,827 shares
during the first and second quarters, 7,031,585 in the third quarter, and
7,032,929 in the fourth quarter.
Item 9. Changes in & Disagreements with Accountants on
Accounting and Financial Disclosure.
_______________________________________________________________________
None
PART III
________
Item 10. Directors and Executive Officers of the Registrant.
_____________________________________________________________________
Executive Officers of the Company
_________________________________
Election of Executive Officers is held each year at the Annual Meeting of
the Board of Directors following the Annual Meeting of the Stockholders.
Name Title Age
____ _____ ___
Ben Hill Griffin, III Chairman of the Board (since March 1990),
Chief Executive Officer (since January
1988) and Director (since March 1973) 59
W. Bernard Lester President (since December 1997) and Chief
Operating Officer (since January 1988) and
Director (since 1987), prior to July 1, 1986
was Executive Director of Florida Department
of Citrus for over five years 62
L. Craig Simmons Vice President (effective February, 1995),
Treasurer and Chief Financial Officer
(effective September 1, 1992), prior thereto
was Controller (from January 1 to August 31,1992)
and Assistant Comptroller (from January 1 to
December 31,1991),prior to September 1990
was Controller of Farm/Citrus Division,
Collier Enterprises, Agribusiness Group 49
Section 16 - Beneficial Ownership Reporting Compliance
______________________________________________________
Based solely upon a review of Forms 3 and 4 and amendments thereto
furnished to the Company pursuant to Rule 16a-3(e) during the 2001 fiscal
year and Forms 5 and amendments thereto furnished to the Company during
fiscal year 1992 and certain written representations, if any, made to the
Company, no officer, director or beneficial owners of 10% or more of the
Company's common stock has failed to file on a timely basis any reports
required by Section 16(a) of the Exchange Act to be filed during fiscal 2001.
For information with respect to the executive officers of the
registrant, see "Executive Officers of the Registrant" at the end of Part I
of this report.
The information called for regarding directors is incorporated by
reference to the Company's Proxy Statement dated November 16, 2001.
Item 11. Executive Compensation.
_________________________________________
Information called for by Items 11 is incorporated by
reference to the Company's Proxy Statement dated November 16, 2001.
As disclosed in the Proxy Statement, on September 12, 2000, the
Company granted options for 51,074 shares of the Company's common
stock to its employees pursuant to the Company's Incentive Equity
Plan, 23,302 of which were awarded to the Company's two most highest
compensated employees. The options had an exercise price of $14.62
and fair market value of $16.313 at the time of the grant.
Item 12. Security Ownership of Certain Beneficial Owners and
Management.
______________________________________________________________________
Information called for by Items 12 is incorporated by
reference to the Company's Proxy Statement dated November 16, 2001.
Item 13. Certain Relationships and Related Transactions.
_________________________________________________________________
Information called for by Items 13 is incorporated by
reference to the Company's Proxy Statement dated November 16, 2001.
PART IV
_______
Item 14. Exhibits, Financial Statement Schedules and Reports
on Form 8-K.
____________________________________________________
(a)1. Financial Statements:
____________________
Included in Part II, Item 8 of this Report
Report of Independent Auditors'
Consolidated Balance Sheets - August 31, 2001 and 2000
Consolidated Statements of Operations - For the Years Ended
August 31, 2001, 2000 and 1999
Consolidated Statements of Stockholders' Equity - For the
Years Ended August 31, 2001, 2000 and 1999
Consolidated Statements of Cash Flows - For the Years Ended
August 31, 2001, 2000 and 1999
(a)2. Financial Statement Schedules:
_____________________________
Selected Quarterly Financial Data - For the Years Ended
August 31, 2001 and 2000 - Included in Part II, Item 8
Schedule I - Marketable Securities and Other Investments -
at August 31, 2001
Schedule V - Property, Plant and Equipment - For the Years
Ended August 31, 2001, 2000 and 1999
Schedule VI - Reserves for Depreciation, Depletion and
Amortization of Property, Plant and Equipment - For the
Years Ended August 31, 2001, 2000 and 1999
Schedule IX - Supplementary Income Statement Information -
For the Years Ended August 31, 2001, 2000 and 1999
All other schedules not listed above are not submitted because they are not
applicable or not required or because the required information is included
in the financial statements or notes thereto.
(a)3. Exhibits:
________
(3) Articles of Incorporation: *
Schedule I - Restated Certificate of Incorporation,
Dated February 17, 1972
Schedule II - Certificate of Amendment to Certificate
of Incorporation, Dated January 14, 1974
Schedule III - Amendment to Articles of Incorporation,
Dated January 14, 1987
Schedule IV - Amendment to Articles of Incorporation,
Dated December 27, 1988
Schedule V - By-Laws of Alico, Inc.,
Amended to September 13, 1994
(4) Instruments Defining the Rights of Security Holders,
Including Indentures - Not Applicable
(9) Voting Trust Agreement - Not Applicable
(10) Material Contracts - Citrus Processing and Marketing
Agreement with Ben Hill Griffin, Inc., dated November 2,
1983, a Continuing Contract. *
(11) Statement - Computation of Per Share Earnings
(12) Statement - Computation of Ratios
(18) Change in Accounting Principles - Not Applicable
(19) Annual Report to Security Holders - By Reference
(21) Subsidiaries of the Registrant - Sadddlebag Lake Resorts, Inc.
(incorporated in 1971) and Agri-Insurance Company, Ltd.
(incorporated in 2000).
(22) Published Report Regarding Matters Submitted to Vote of
Security Holders - Not Applicable
(23) Consents of Experts and Counsel - Not Applicable
(24) Power of Attorney - Not Applicable
(28) Information From Reports Furnished to State Insurance
Regulatory Authorities - Not Applicable
(99) Additional Exhibits - None
(b)3. Reports on Form 8-K:
___________________
Form 8-K dated December 15, 2000 regarding re-election of
Directors and election of Officers.
Form 8-K dated November 3, 2000 regarding disposition of land.
Form 8-K dated December 14, 2000 regarding disposition of land.
Form 8-K dated December 19, 2000 regarding disposition of land.
Form 8-K dated December 21, 2000 regarding disposition of land.
Form 8-K dated March 7, 2001 regarding election of new Director.
Form 8-K dated March 23, 2001 regarding disposition of land.
Form 8-K dated May 18, 2000 regarding disposition of land.
Form 8-K dated June 12, 2001 regarding Chairman and CEO taking
leave of absence.
Form 8-K dated August 3, 2001 regarding Chairman and CEO returning
from leave of absence.
Form 8-K dated October 9, 2001 regarding a settlement agreement
and litigation in State Court, Polk County, Florida.
Form 8-K dated October 29, 2001 regarding disposition of land.
Material has been filed with Securities and Exchange Commission and NASDAQ
and may be obtained upon request.
ALICO, INC.
SCHEDULE I
Marketable Securities and Other Investments
August 31, 2001
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
________ ________ ________ ________ ________
Amount of Which
Each Portfolio
of Equity Secu-
Number of Market rity Issues and
Shares or Value of Each Other Se-
Name of Issuer Units-Principal Cost of Each Issue curity Issue
and Title of Amounts of Bonds Each at Balance Carried in the
Each Issue and Notes Issue Sheet Date Balance Sheet
______________ _______________ ___________ ____________ ___________
Municipal Bonds 750,083 $ 750,083 $ 787,201 $ 787,201
Mutual Funds 9,934,236 9,934,236 11,044,493 11,044,493
Preferred Stocks 141,500 3,564,585 3,592,295 3,592,295
Common Stocks 57,986 2,151,892 2,412,188 2,412,188
Other
Investments 929,298 929,298 890,546 890,546
___________ ___________ ___________
Total: $17,330,094 $18,726,723 $18,726,723
___________ ___________ ___________
___________ ___________ ___________
ALICO, INC.
SCHEDULE V
PROPERTY, PLANT AND EQUIPMENT
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ _________ _________ ________ ________ ________
Other Changes
Balance Retire- Debit and/or Balance
Beginning Additions ments Credit- at Close
Description of Period at Cost or Sales Describe of Period
___________ _________ _________ _________ ___________ __________
For Year Ended August 31, 2001
______________________________
Land $32,395,754 $ 42,266 $ 814,295 $ $ 31,623,725
Roads 2,156,452 32,041 2,188,493
Agricultural Land
Preparation 9,906 9,906
Forest Improvements 100,026 100,026
Pasture
Improvements 3,012,907 50,446 24,438 3,038,915
Buildings 3,553,390 235,226 3,788,616
Feeding and Watering
Facilities for
Cattle Herd 22,995 4,956 18,039
Water Control
Facilities 5,337 5,337
Fences 277,102 10,669 1,498 286,273
Cattle Pens 186,809 10,736 176,073
Interest-Ranch 0 16,963 16,963
Irrigation System-
Ranch 0 329,801 329,801
Citrus Groves,
Including Irrigation
Systems 44,327,540 2,817,916 2,032,908 45,112,548
Equipment 8,956,294 1,100,457 609,866 9,446,885
Breeding Herd 13,713,389 1,531,307 2,779,829 12,464,867
Sugarcane-Land Prep-
aration, Etc. 25,991,444 2,112,392 1,064,230 27,039,605
Sod Land-Prep-
aration, Etc. 270,719 587,191 857,910
Farm Land Prep-
aration, Etc. 1,842,317 6,000 1,848,317
___________ ___________ __________ _______ ____________
$136,822,381 $ 8,872,675 $7,342,756 $ $138,352,300
___________ ___________ __________ _______ ____________
___________ ___________ __________ _______ ____________
ALICO, INC.
SCHEDULE V
PROPERTY, PLANT AND EQUIPMENT
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ _________ _________ ________ ________ ________
Other Changes
Balance Retire- Debit and/or Balance
Beginning Additions ments Credit- at Close
Description of Period at Cost or Sales Describe of Period
___________ _________ _________ _________ ___________ __________
For Year Ended August 31, 2000
______________________________
Land $32,446,339 $ 15,821 $ 66,406 $ $32,395,754
Roads 1,415,260 741,192 2,156,452
Agricultural Land
Preparation 9,906 9,906
Forest Improvements 100,026 100,026
Pasture
Improvements 2,988,469 24,438 3,012,907
Buildings 3,378,101 293,695 118,406 3,553,390
Feeding and Watering
Facilities for
Cattle Herd 17,454 5,541 22,995
Water Control
Facilities 5,337 5,337
Fences 266,909 24,402 14,209 277,102
Cattle Pens 155,652 31,157 186,809
Citrus Groves,
Including Irrigation
Systems 46,184,668 849,070 2,706,198 44,327,540
Equipment 8,159,823 1,555,882 759,411 8,956,294
Breeding Herd 12,584,592 2,619,785 1,490,988 13,713,389
Sugarcane-Land Prep-
aration, Etc. 22,634,545 4,736,794 1,379,895 25,991,444
Sod-Land Prep-
aration, Etc. 191,441 79,278 270,719
Farm Land Prep-
aration 1,834,317 8,000 1,842,317
___________ __________ __________ _______ ____________
$132,372,839 $10,985,055 $6,535,513 $ $136,822,381
___________ __________ __________ _______ ____________
___________ __________ __________ _______ ____________
ALICO, INC.
SCHEDULE V
PROPERTY, PLANT AND EQUIPMENT
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ _________ _________ ________ ________ ________
Other Changes
Balance Retire- Debit and/or Balance
Beginning Additions ments Credit- at Close
Description of Period at Cost or Sales Describe of Period
___________ _________ _________ _________ ___________ __________
For the Year Ended August 31, 1999
__________________________________
Land $22,867,648 $9,746,174 $ 167,483 $ $32,446,339
Roads 957,826 457,434 1,415,260
Agricultural Land
Preparation 9,906 9,906
Forest Improvements 100,026 100,026
Pasture Improve-
ments 2,988,469 2,988,469
Buildings 2,994,000 384,101 3,378,101
Feeding and Watering
Facilities for
Cattle Herd 30,317 12,863 17,454
Water Control
Facilities 5,337 5,337
Fences 298,011 1,252 32,354 266,909
Cattle Pens 134,955 20,697 155,652
Citrus Groves,
Including Irri-
gation Systems 39,023,959 7,160,709 46,184,668
Equipment 7,288,254 1,830,423 958,854 8,159,823
Breeding Herd 12,588,424 1,796,519 1,800,351 12,584,592
Sugarcane-Land
Prep.,Etc. 15,822,850 7,338,020 526,325 22,634,545
Sod-Land Prep-
aration,Etc. 184,916 6,525 191,441
Farm Land Prep-
aration 1,769,853 64,464 1,834,317
___________ __________ __________ _________ ___________
$107,064,751 $28,806,318 $3,498,230 $ $132,372,839
___________ __________ __________ _________ ___________
___________ __________ __________ _________ ___________
* Reclassification from other assets.
ALICO, INC.
SCHEDULE VI
Reserves for Depreciation, Depletion and Amortization
of Property, Plant and Equipment
_____________________________________________________
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ __________ __________ __________ ________ ________
Additions Other
Balance Charged To Changes Balance
Beginning Profit & Loss Retire- Add(Deduct) at
Description of Period of Income ments Desccribe Close Of
___________ _________ ____________ __________ _________ ________
For Year Ended August 31, 2001
______________________________
Buildings $ 1,502,400 $ 160,109 $ $ $ 1,662,509
Feeding and Watering
Facilities for
Cattle Herd 9,067 734 4,956 4,845
Water Control
Facilities 0 0 0 0
Fences 129,521 28,165 203 157,483
Cattle Pens 99,012 14,525 10,736 102,801
Interest-Ranch 0 283 283
Irrigation System-
Ranch 0 3,997 3,997
Citrus Groves,
Including Irriga-
tion Systems 13,715,634 1,949,064 828,499 14,836,199
Equipment 5,088,513 1,037,208 503,729 5,621,992
Breeding Herd 5,132,625 1,275,138 1,940,507 4,467,256
Roads 173,052 115,467 288,519
Sugarcane Lane Prep-
aration, Etc. 5,950,645 2,314,161 745,557 7,519,249
Sod Land Prepara-
tion, Etc. 16,066 8,487 24,553
Farm Land Preparation 149,957 38,667 188,624
___________ __________ __________ ____ ___________
$31,966,492 $6,946,005 $4,034,187 $ 0 $34,878,310
___________ __________ __________ ____ ___________
___________ __________ __________ ____ ___________
ALICO, INC.
SCHEDULE VI
Reserves for Depreciation, Depletion and Amortization
Property, Plant and Equipment
_____________________________________________________
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ __________ __________ __________ ________ ________
Additions Other
Balance Charged To Changes Balance
Beginning Profit & Loss Retire- Add(Deduct) at
Description of Period of Income ments Desccribe Close Of
___________ _________ ____________ __________ _________ ________
For Year Ended August 31, 2000
______________________________
Buildings $ 1,407,257 $ 153,267 $ 58,124 $ $ 1,502,400
Feeding and Watering
Facilities for
Cattle Herd 8,496 571 9,067
Water Control
Facilities 0 0 0 0
Fences 117,083 26,647 14,209 129,521
Cattle Pens 85,215 13,797 99,012
Citrus Groves,
Including Irriga-
tion Systems 13,213,300 1,986,634 1,484,300 13,715,634
Equipment 4,793,420 989,713 694,620 5,088,513
Breeding Herd 6,276,893 (220,982) 923,286 5,132,625
Roads 113,385 59,667 173,052
Sugarcane-Land Prep-
aration, Etc. 5,263,793 2,066,746 1,379,894 5,950,645
Sod-Land Prepara-
tion, Etc. 11,414 4,652 16,066
Farm Land Preparation 111,815 38,142 149,957
___________ __________ __________ ____ ___________
$31,402,071 $5,118,854 $4,554,433 $ 0 $31,966,492
___________ __________ __________ ____ ___________
___________ __________ __________ ____ ___________
ALICO, INC.
SCHEDULE VI
Reserves for Depreciation, Depletion and Amortization
Property, Plant and Equipment
_____________________________________________________
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ __________ __________ __________ ________ ________
Additions Other
Balance Charged To Changes Balance
Beginning Profit & Loss Retire- Add(Deduct) at
Description of Period of Income ments Desccribe Close Of
___________ _________ ____________ __________ _________ ________
For the Year Ended August 31, 1999
__________________________________
Buildings $ 1,268,644 $ 138,613 $ $ $ 1,407,257
Feeding and Watering
Facilities for
Cattle Herd 21,006 353 12,863 8,496
Water Control
Facilities 0 0 0 0
Fences 122,850 26,587 32,354 117,083
Cattle Pens 71,264 13,951 85,215
Citrus Groves,
Including Irrigation
Systems 11,299,211 1,914,089 13,213,300
Equipment 4,881,745 809,596 897,921 4,793,420
Breeding Herd 6,939,132 1,024,231 1,686,470 6,276,893
Roads 71,900 41,485 113,385
Sugarcane-Land
Prep.,Etc. 4,425,063 1,344,917 506,187 5,263,793
Sod-Land Prep-
aration, Etc. 7,499 3,915 11,414
Farm Land
Preparation 74,102 37,713 111,815
___________ __________ __________ _______ ___________
$29,182,416 $5,355,450 $3,135,795 $ 0 $31,402,071
___________ __________ __________ _______ ___________
___________ __________ __________ _______ ___________
ALICO, INC.
SCHEDULE IX
____________
SUPPLEMENTARY INCOME STATEMENT INFORMATION
__________________________________________
_____________________________________________________________________________
COLUMN A COLUMN B
_____________________________________________________________________________
Charged to Costs and Expenses
_____________________________
Years Ended August 31,
______________________
Item 2001 2000 1999
____ ____ ____ ____
1. Maintenance and repairs $1,475,565 $1,294,131 $1,094,379
2. Taxes, other than payroll
and income taxes 1,616,942 2,130,749 2,427,161
EXHIBIT 11
ALICO, INC.
Computation of Weighted Average Shares Outstanding as of August 31, 2001:
Number of shares outstanding at August 31, 2001 7,044,513
_________
_________
Number of shares outstanding at August 31, 2000 7,027,827
_________
_________
Weighted Average 9/1/99 - 8/31/01 7,032,929
_________
_________
EXHIBIT 12
ALICO, INC.
Computation of Ratios:
2001 Current Assets $61,344,839
Current Liabilities 7,690,600
61,344,839 divided by 7,690,600 = 7.98:1
2000 Current Assets $56,578,383
Current Liabilities 12,346,277
56,578,383 divided by 12,346,277 = 4.58:1
Pursuant to the requirements of Section 13 of the Securities Exchange Act
of 1934, as amended, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
ALICO, INC.
(Registrant)
November 13, 2001 Ben Hill Griffin, III
Date Chairman, Chief Executive
Officer and Director
(Signature)
November 13, 2001 W. Bernard Lester
Date President, Chief Operating
Officer and Director
(Signature)
November 13, 2001 L. Craig Simmons
Date Vice President and
Chief Financial Officer
(Signature)
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the date indicated:
Richard C. Ackert Ben Hill Griffin, IV
Director Director
(Signature) (Signature)
K. E. Hartsaw Thomas E. Oakley
Director Director
(Signature) (Signature)
William L. Barton Monterey Campbell, III
Director Director
(Signature) (Signature)
Walker E. Blount, Jr.
Director
(Signature)
November 13, 2001
Date