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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, 1997.
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)
(941)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 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.
_________
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_____
As of October 20, 1997 there were 7,027,827 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 nonaffiliates was
approximately $83,851,165.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's Annual Report and Proxy Statement dated
November 10, 1997 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 142,709 acres of land located in Collier, Hendry, Lee and Polk
Counties. (See table on Page 5 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 10,006 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 5,042 acres in production during the 1997 fiscal year consisted of
995 acres planted in the fall of 1992, 993 acres planted in 1993, 1558
acres planted in 1994, and 1,496 acres planted in 1995.
The Company continued to expand agriculture activities during the 1997
fiscal year, continuing development of a farm leasing project.
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 3 to 5 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 11 of Notes to Consolidated
Financial Statements and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" incorporated in this document.
Subsidiary Operations
_____________________
The Company's wholly owned subsidiary, Saddlebag Lake Resorts, Inc. (the
"Subsidiary"), is only active in the subdividing, development and sale of
real estate. The financial results of the operation of this subsidiary are
consolidated with those of the Company. (See Note 1 of Notes to Financial
Statements.)
Contributions by the Subsidiary to the net income of the Company, during
the past five years, have ranged from 0 to 1 percent. The Subsidiary has
two subdivisions near Frostproof, Florida which have been developed and are
on the market. Approximately 74% of the lots have been sold.
Citrus
______
Approximately 8,358 acres of citrus were harvested during the 1997 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, 1997, approximately 89% of the Company's
fruit crop was marketed under this agreement, as compared to 88% in 1995/96.
The Company expects that the majority of the 1997/98 crop will be marketed
under the same terms. In addition, Ben Hill Griffin, Inc. provides harvesting
services to the Company for citrus sold to unrelated processors. These sales
accounted for the remaining 11% of total citrus revenue for the year.
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 16,500 cows, bulls and replacement heifers. Approximately
45% of the herd are from one to five years old, while the remaining 55% 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 up
to 50% of its beef inventory by entering into cattle futures contracts to
reduce exposure to changes in market prices.
Sugarcane
_________
The Company had 5,042 acres and 5,023 acres of sugarcane in production
during the 1996/97 and 1995/96 fiscal year, respectively. The 1996/97 and
1995/96 crops yielded approximately 158,000 and 187,000 gross tons,
respectively.
Forest Products
_______________
Approximately 7% 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 lands 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 it's 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 Florida Rock
Industries, Inc. of Jacksonville, 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, 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 1997 the Company had a total of 124 full-time
employees classified as follows: Citrus 59; Ranch 12; Sugarcane 9;
Facilities Maintenance Support 28; General and Administrative 16. There
are no employees engaged in the development of new products or research.
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, 1997, the Company owned a total of 142,709 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 550 8,848 447 -- 3,148 -- -- 4 12,997
Lee 3,731 1,088 -- -- -- -- 1,460 3,635 9,914
Hendry 3,823 57,621 25,381 220 2,299 7,300 8,186 3,629 108,459
Collier 1,902 1,951 1,112 -- 4,041 -- -- 2,333 11,339
______ _______ ______ ___ _____ _____ _____ _____ _______
Totals 10,006 69,508 26,940 220 9,488 7,300 9,646 9,601 142,709
______ _______ ______ ___ _____ _____ _____ _____ _______
______ _______ ______ ___ _____ _____ _____ _____ _______
Of the above lands, the Company utilizes 26,493 acres of improved pasture
plus approximately 56,000 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 18,882
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.
In October 1992 the Company entered into a contract, with the Board of
Regents of the State of Florida, committing to a donation of 975 acres of
land and other items, in connection with a new state university. In
addition to the contribution of land, the following items and amounts were
also committed: design and planning - $200,000; academic chairs -
$1,200,000; road construction - $2,400,000.
Governmental approvals have been obtained to develop approximately 2,500
acres surrounding the University site. However, the development schedule
of the University is subject to the appropriation of funds by the
legislature. The University opened in August 1997.
Item 3. Legal Proceedings.
___________________________________
There are no pending legal proceedings involving the Company.
Item 4. Submission of Matters to a Vote of Security Holders.
_____________________________________________________________________
There were no matters submitted to a vote of security holders during the
1997 fiscal year.
Executive Officers of the Company
_________________________________
Pursuant to General Instruction G(3) of Form 10-K, the following list is
included as an unnumbered Item in Part I of this report in lieu of being
included in the Proxy Statement for the Annual Meeting of Stockholders to
be held on December 2, 1997.
Election of Executive Officer 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),
President and Chief Executive Officer (since
January 1988) and Director (since March 1973) 55
W. Bernard Lester Executive Vice President 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 58
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 45
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 1997 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
1997.
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, 1997 and 1996 are presented
below:
1997 1996
Bid Price Bid Price
_________ _________
High Low High Low
First Quarter 22 1/4 19 1/4 22 1/4 17
Second Quarter 21 1/4 18 26 1/2 21 3/4
Third Quarter 20 1/2 17 5/8 25 1/2 20 11/16
Fourth Quarter 25 1/4 18 1/2 22 3/4 17 1/4
Approximate Number of Holders of Common Stock
_____________________________________________
As of October 20, 1997 there were approximately 928 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 21, 1994 November 10, 1994 $.25
October 20, 1995 November 10, 1995 $.35
October 25, 1996 November 8, 1996 $.15
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 1997 1996 1995 1994 1993
________ ________ ________ ________ ________
(In Thousands Except Per Share Amounts)
Revenues $ 47,433 $ 36,089 $ 39,571 $ 38,502 $ 28,563
Costs and Expenses 29,583 29,269 25,105 26,799 24,103
Income Taxes 6,677 2,381 5,525 3,975 1,503
Cumulative Effect of
Accounting Change - - - - 2,337
Net Income 11,173 4,439 8,941 7,728 5,294
Average Number of
Shares Outstanding 7,028 7,028 7,028 7,028 7,028
Net Income per Share 1.59 .63 1.27 1.10 .75
Cash Dividend Paid per Share .15 .35 .25 .15 .15
Current Assets 37,887 34,877 31,736 28,341 23,597
Total Assets 117,723 114,504 109,007 102,185 90,516
Current Liabilities 4,988 5,115 5,656 5,660 2,936
Ratio-Current Assets
to Current Liabilities 7.59:1 6.82:1 5.61:1 5.01:1 8.04:1
Working Capital 32,899 29,762 26,080 22,680 20,661
Long-Term Obligations 24,582 32,006 27,945 28,568 26,296
Total Liabilities 29,570 37,121 33,601 34,228 29,232
Stockholders' Equity 88,153 77,383 75,406 67,957 61,283
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 $12.9 million at August
31, 1997 compared with $11.1 million at August 31, 1996. Working capital
also increased, from $29.8 million at August 31, 1996 to $32.9 million at
August 31, 1997. An increase in the number of animals, resulting from the
Company's policy of placing cattle into feedlots, has caused the beef
inventory to rise and is the primary reason for the increase in working
capital.
A large real estate sale ($11.5 million gross sales price) to the State of
Florida was closed in the second quarter of fiscal 1997. Proceeds from
the sale were used to reduce the note payable and pay income taxes.
Cash outlay for land, equipment, building, and other improvements totaled
$5.8 million, compared to $7.1 million during August 31, 1997 and 1996,
respectively. Major expenditures included capitalized maintenance costs
for young citrus groves. Land excavation for farm leasing also continued,
as did expenditures for replacement equipment and sugarcane capital
maintenance. Development is now complete on citrus groves. Capital
projects are currently expected to decline during the next fiscal year.
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 unused credit commitments which
provided for revolving credit of up to $30 million of which $17.1 million
was available for the Company's general use at August 31, 1997 (see note 6
of consolidated financial statements).
Results of Operations
_____________________
Summary of results (in thousands):
Years Ended August 31,
1997 1996 1995
_______ _______ _______
Operating revenue $34,543 $34,505 $30,547
Gross profit 5,886 6,720 7,059
Profit on sale of real estate 11,271 57 7,585
Interest and investment income 1,137 1,033 998
Interest expense 444 990 1,176
Provision for income taxes 6,677 2,381 5,525
Effective income tax rate 37.4% 34.9% 38.2%
Net income 11,173 4,439 8,941
Operating Revenue
_________________
Operating revenues for fiscal 1997 approximated those of fiscal 1996. Decreases
in citrus and sugarcane sales were offset by increased cattle and rock sales,
and increased land rentals.
Operating revenues for fiscal 1996 increased 13% over fiscal 1995, primarily
the result of increased citrus and ranch sales revenues.
Gross Profit
____________
Gross profit during fiscal 1997 declined by 12% from fiscal 1996. The decrease
was primarily due to lower market prices for citrus products and decreased
sugarcane production.
Gross profit during fiscal 1996 decreased 5% from fiscal 1995. While gross
profit from agriculture during the year approximated the prior year, the decline
was due to increases in general and administrative expenses and allocated costs.
Profit on Sale of Real Estate
____________________________________
Profit from the sale of real estate increased to $11.27 million during fiscal
1997, as compared to $57 thousand during fiscal 1996. Sales during 1997
included the sale of approximately 21,700 acres of land in Hendry and Collier
Counties, Florida, to the State of Florida for $11.5 million, the pretax gain
from which was $11.1 million, and several smaller sales in Lee, Collier and
Polk Counties.
Profit from the sale of real estate declined to $57 thousand during fiscal 1996,
compared to $7.6 million during fiscal 1995. Sales were minimal, compared to
1995, which included a large sale in Polk County.
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. Investment earnings were reinvested throughout fiscal 1997 and 1996,
increasing investment levels during each year. The rise in fiscal 1997 net
interest and investment income resulted from higher investment levels and
favorable market conditions.
The rise in fiscal 1996 net interest and investment income resulted from higher
investment levels.
Interest Expense
________________
Interest expense decreased 56% during fiscal 1997 due primarily to a large
reduction in total long-term debt, likewise, total interest cost, which
includes capitalized interest and is discussed in Note 6, decreased 37%.
During fiscal year 1996, interest expense decreased 16% and total interest
cost decreased 3% compared to fiscal year 1995, due to lower interest rates.
Provision for Income Taxes
__________________________
The effective tax rate increased to 37.4% during fiscal year 1997, from 34.9%
during fiscal year 1996. Higher taxable income levels during fiscal 1997
decreased the percentage impact of certain tax exempt investment income.
Individual Operating Divisions
______________________________
Gross profit for the individual operating divisions, for fiscal 1997, 1996
and 1995, is presented in the following schedule and is discussed in
subsequent sections:
Years Ended August 31,
(in thousands)
1997 1996 1995
_______ _______ _______
CITRUS
Revenues:
Sales $22,287 $22,966 $19,674
Less harvesting & marketing 8,210 6,948 6,569
_______ _______ _______
Net Sales 14,077 16,018 13,105
Cost and Expenses:
Direct production** 6,875 5,964 5,488
Allocated cost* 2,352 2,470 2,205
_______ _______ _______
Total 9,227 8,434 7,693
_______ _______ _______
Gross profit, citrus 4,850 7,584 5,412
_______ _______ _______
SUGARCANE
Revenues:
Sales 4,967 5,851 6,026
Less harvesting & hauling 1,120 1,237 1,294
_______ _______ _______
Net Sales 3,847 4,614 4,732
Costs and expenses:
Direct production 1,826 1,758 1,681
Allocated cost* 1,190 1,152 1,291
_______ _______ _______
Total 3,016 2,910 2,972
_______ _____ _______
Gross profit, sugarcane 831 1,704 1,760
_______ _______ _______
Individual Operating Divisions (Continued)
Years Ended August 31,
(in thousands)
1997 1996 1995
_______ _______ _______
RANCH
Revenues:
Sales 4,876 3,796 2,952
Costs and expenses:
Direct production 3,165 3,890 1,438
Allocated cost* 946 1,539 1,008
_______ _______ _______
Total 4,111 5,429 2,446
_______ _______ _______
Gross profit (loss), ranch 765 (1,633) 506
_______ _______ _______
Total gross profit,
agriculture 6,446 7,655 7,678
_______ _______ _______
OTHER OPERATIONS
Revenues:
Rock products and sand 1,258 935 956
Oil leases and land rentals 831 679 678
Forest products 224 197 146
Other 100 80 116
_______ _______ _______
Total 2,413 1,891 1,896
Costs and expenses:
Allocated Cost* 481 456 384
General and administrative,
all operations 2,492 2,370 2,131
_______ _______ _______
Total 2,973 2,826 2,515
_______ _______ _______
Gross loss, other
operations (560) (935) (619)
_______ _______ _______
Total gross profit 5,886 6,720 7,059
_______ _______ _______
Years Ended August 31,
(in thousands)
1997 1996 1995
_______ _______ _______
INTEREST & DIVIDENDS
Revenue 1,137 1,033 998
Expense 444 990 1,176
_______ _______ _______
Interest & dividends, net 693 43 (178)
_______ _______ _______
REAL ESTATE
Revenue:
Sale of real estate 11,753 551 8,026
Expenses:
Cost of sales 122 151 111
Other Costs 360 343 330
_______ _______ _______
Total 482 494 441
_______ _______ _______
Gain on sale of real estate 11,271 57 7,585
_______ _______ _______
Income before income taxes $17,850 $ 6,820 $14,466
_______ _______ _______
_______ _______ _______
* 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 $875 thousand on 1,130 acres in 1997, $1.6 million on
1,648 acres in 1996 and $1.4 million on 1,718 acres in 1995.
Citrus
______
Gross profit was $4.8 million in fiscal 1997, $7.6 million for fiscal 1996,
and $5.4 million in 1995.
Revenue from citrus sales decreased 3% during fiscal 1997, compared to fiscal
1996 ($22.3 million during fiscal 1997 vs. $22.9 million during fiscal 1996).
Despite an 18% increase in production for the year (4.4 million boxes during
fiscal 1997 vs. 3.7 million boxes during fiscal 1996), an offsetting 18% decline
in the average market price per box ($5.09 in fiscal 1997 vs. $6.21 per box in
fiscal 1996) caused the decrease.
The increase in the number of boxes harvested during fiscal 1997 generated
harvesting and marketing costs in excess of the prior year ($8.2 million in
fiscal 1997 vs. $6.9 million in fiscal 1996). Direct production and allocated
costs likewise increased as a result of the rise in production. The production
increase was attributable to the addition of the first phase of the K-T Grove,
combined with improved yields from maturing groves in South Florida.
Revenue from citrus sales increased 17% during fiscal 1996, compared to fiscal
1995 ($22.9 million during fiscal 1996 vs. $19.7 million during fiscal 1995).
This was largely attributable to an 8% increase in production for the year
(3.7 million boxes during fiscal 1996 vs. 3.4 million during fiscal 1995),
combined with an 8% increase in the average market price per box ($6.21 in
fiscal 1996 vs. $5.80 in fiscal 1995).
Direct production costs, associated with the increased yield, rose 10% during
fiscal 1996. The corresponding large increase in revenues from citrus sales
offset the rise in costs and generated the 40% increase in gross profit for
this division.
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
conservatively applied. Differences between the estimates and the final
realization of revenues can be significant. Revenue collected in excess of
prior year and year end estimates was $1.0 million, $1.1 million and $1.8
million during fiscal 1997, 1996 and 1995, respectively.
ACREAGE BY VARIETY AND AGE
VARIETY 0-1 1-2 3-4 5-6 7-8 9-10 11-12 13-14 15-16 20+ Acres
___ ___ ___ ___ ___ ____ _____ _____ _____ ___ _____
Early:
Parson Brown
Oranges - - - 117 30 - - - - - 147
Hamlin
Oranges - 386 170 32 30 714 - 110 239 1,335 3,016
Red Grapefruit- - - 54 - - - 48 158 169 429
White Grapefruit- - - - 318 - - - - 21 339
Tangelos - - - - - - - - - 135 135
Navel Oranges - - - 15 - - - 54 84 - 153
Mid Season:
Pineapple
Oranges - - 103 - - - - 18 - 467 588
Queen Oranges - - - - - - - - - 51 51
Honey
Tangerines - 80 - - 45 - - - 94 - 219
Midsweet
Oranges - 54 110 - - - - - - - 164
Late:
Valencia
Oranges - 826 310 557 329 800 - 35 165 1,225 4,247
_____ ___ ___ ___ _____ ___ ___ ___ ___ _____ _____
Totals: - 1,346 693 775 752 1,514 - 265 740 3,403 9,488
Sugarcane
_________
Gross profit for fiscal 1997 was $831 thousand compared to $1.7 million in
fiscal 1996 and $1.8 million in fiscal 1995.
Sales revenues from sugarcane decreased 15% during fiscal 1997, compared to
fiscal 1996 ($4.9 million vs. $5.9 million, respectively). During the same
period, direct production and allocated costs increased by 4% ($3.0 million in
fiscal 1997 vs. $2.9 million in fiscal 1996).
Although the acres harvested during 1997 approximated fiscal 1996 levels
(roughly 5 thousand acres each year), the number of gross tons harvested during
fiscal 1997 was 15% below year ago levels (158 thousand gross tons harvested
during 1997 vs. 187 thousand harvested during fiscal 1996). Poor weather
conditions were the cause for the decrease in sugarcane production.
Sales revenues from sugarcane decreased 3% during fiscal 1996, compared to
fiscal 1995 ($5.9 million vs. $6.0 million, respectively). Direct production
and allocated costs also decreased 2% during the year ($2.9 million vs. $3.0
million, respectively).
The number of acres harvested and resulting yield for fiscal 1996 approximated
fiscal 1995 levels, causing the relatively minor difference in operating results
(5 thousand acres harvested yielded 187 thousand gross tons in fiscal 1996 vs.
5 thousand acres yielding 186 thousand gross tons during fiscal 1995).
Ranching
________
The gross profit (loss) from ranch operations for fiscal 1997, 1996 and 1995
was $765 thousand, $(1.6 million), and $506 thousand, respectively.
Revenues from cattle sales increased 28% during fiscal 1997, compared to fiscal
1996 ($4.9 million in fiscal 1997 vs. $3.8 million in fiscal 1996). The number
of animals sold during the year increased 26% over the prior year (9,095 animals
sold in fiscal 1997 vs. 7,211 in fiscal 1996). The rise is due to increased
sales of feeder cattle inventories during the year, combined with a significant
improvement in market prices for beef.
Direct and allocated costs declined from their year ago levels ($4.1 million
in fiscal 1997 vs. $5.4 million in fiscal 1996). Due to market conditions,
the Company was required to write down its fiscal 1996 beef inventory to net
realizable value. This adjustment totaled $909 thousand. Additionally, in
fiscal 1996, the Company wrote off $400 thousand of sod costs. The charge
was included in ranching costs. The sod write off was necessary because of
excessive rain and subsequent weed intrusion.
The Company's cattle marketing activities include retention of calves in western
feedlots, contract and auction sales, and risk management contracts.
Revenues from cattle sales increased 27% during fiscal 1996, compared to fiscal
1995 ($3.8 million in fiscal 1996 vs. $3.0 million in fiscal 1995). The number
of animals sold increased 11% over the prior year (7,211 sold in fiscal 1996
vs. 6,482 in fiscal 1995); however, the average revenue per pound decreased 17%
due to poor market conditions.
Additional costs to feed calves to maturity, increased by a grain shortage,
caused direct and allocated costs to increase during fiscal 1996 when compared
to fiscal 1995 ($5.4 million vs. $2.4 million during fiscal 1996 and 1995,
respectively). The increased costs during fiscal 1996 also included a beef
inventory write down and the write off of sod costs referred to above.
Other Operations
________________
Revenues from oil royalties and land rentals were $831 thousand for fiscal
1997 compared to $679 thousand for fiscal 1996 and $678 thousand for fiscal
1995. The rise during fiscal 1997 was primarily due to increased revenue as
a result of the development of additional land for farming leases.
Returns from rock products and sand were $1.2 million for fiscal 1997 compared
to $935 thousand and $956 thousand for fiscal 1996 and 1995, respectively. The
variations between each of the years is due to the overall economic situation
in the construction and road building industries. Rock and sand supplies are
sufficient, and no major price changes have occurred over the past 3 years.
Profits from the sale of sabal palms, for landscaping purposes, during fiscal
1997 were $169 thousand compared to $197 thousand and $146 thousand for fiscal
years 1996 and 1995, respectively. Additionally, the Company received $55
thousand from the sale of pulpwood during fiscal 1997. No such sales were made
during fiscal 1996 or 1995.
Direct and allocated expenses charged to the "Other" operations category
included general and administrative and other costs not charged directly to
citrus, ranching, sugarcane or forestry. These expenses totaled $3.0 million
during fiscal 1997 compared to $2.8 million during fiscal 1996 and $2.5 million
during fiscal 1995. The fiscal 1997 increase over 1996 was partially related
to costs expended for maintenance of properties used in farm lease operations
($82 thousand). The fiscal 1996 increase over 1995 was primarily attributable
to increases in employee benefits ($141 thousand), worker's compensation expense
($38 thousand) and ad valorem taxes ($82 thousand).
The Florida Gulf Coast University opened its doors in August 1997. The Company
is continuing its marketing and permit activities for its land which surrounds
the University site.
During November of 1996, the Company announced an agreement with Miromar
Development, Inc. of Montreal, Canada to sell 550 acres of land surrounding the
University site in Lee County for $9.35 million. The contract calls for 25% of
the purchase price to be paid at closing, with the balance payable over the next
four years. If the sale closes, it will generate a pretax gain of approximately
$8.7 million.
Additionally, the Company announced an option agreement with REJ Group, Inc.
The option agreement permits the acquisition of a minimum 150 acres and a
maximum of 400 acres within the 2,300 acre university village. The potential
pretax gain to Alico, if the option is exercised, would vary from $8.5 million
to $24.5 million, depending on the time at which the option is exercised, and
the total number of acres selected.
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 subsidiary
as of August 31, 1997 and 1996, 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, 1997. These consolidated financial
statements 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 generally accepted auditing
standards. 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 signif-
icant 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 subsidiary at August 31, 1997 and 1996, and the results of their
operations and cash flows for each of the years in the three-year period ended
August 31, 1997, in conformity with generally accepted accounting principles.
KPMG PEAT MARWICK LLP
(Signature)
Orlando, Florida
October 10, 1997
CONSOLIDATED BALANCE SHEETS
August 31,
1997 1996
_____________ ____________
ASSETS
Current assets:
Cash, including time deposits and other
cash investments of $1,414,436 in 1997
and $1,396,193 in 1996 $ 1,459,765 $ 1,428,059
Marketable equity securities available
for sale, at estimated fair value in
1997 and in 1996 (note 2) 9,195,341 6,799,590
Other marketable securities available for
sale, at estimated fair value in 1997
and in 1996 (note 2) 2,217,574 2,826,435
Accounts receivable ($5,549,080 in 1997 and
$7,758,469 in 1996 due from affiliate)
(note 9) 7,456,937 9,432,838
Mortgages and notes receivable, current
portion (note 3) 901,112 867,145
Inventories (note 4) 16,387,128 13,284,527
Other current assets 269,463 238,038
____________ ____________
Total current assets 37,887,320 34,876,632
____________ ____________
Other assets:
Land inventories 8,345,116 7,777,942
Mortgages and notes receivable, net of
current portion (note 3) 588,860 1,531,947
Investments 955,779 1,016,526
____________ ____________
Total other assets 9,889,755 10,326,415
____________ ____________
Property, buildings and equipment (note 5) 96,709,440 97,029,453
Less accumulated depreciation (26,763,790) (27,728,927)
____________ ____________
Net property, buildings and equipment 69,945,650 69,300,526
____________ ____________
Total assets $117,722,725 $114,503,573
____________ ____________
____________ ____________
August 31,
1997 1996
____________ ____________
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,158,012 $ 1,070,092
Due to profit sharing plan (note 7) 230,545 223,152
Accrued ad valorem taxes 1,253,053 1,095,427
Accrued road commitment (note 10) 212,075 1,236,340
Accrued expenses 329,772 142,047
Income taxes payable 934,895 190,639
Deferred income taxes (note 8) 869,763 1,157,169
____________ ____________
Total current liabilities 4,988,115 5,114,866
Notes payable to a banks (note 6) 12,856,000 20,630,000
Deferred income taxes (note 8) 11,712,806 11,291,936
Deferred retirement benefits (note 7) 13,259 84,117
____________ ____________
Total liabilities 29,570,180 37,120,919
____________ ____________
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
7,027,827 in 1997 and 1996 7,027,827 7,027,827
Unrealized gains on marketable securities
(note 2) 913,059 261,686
Retained earnings 80,211,659 70,093,141
____________ ____________
Total stockholders' equity 88,152,545 77,382,654
____________ ____________
Total liabilities and stockholders'
equity $117,722,725 $114,503,573
____________ ____________
____________ ____________
See accompanying notes to consolidated financial statements.
CONSOLIDATED STATEMENTS OF OPERATIONS
Years Ended August 31,
1997 1996 1995
___________ ___________ ___________
Revenue:
Citrus (note 9) $22,287,006 $22,966,004 $19,673,501
Sugarcane 4,966,837 5,850,764 6,025,745
Ranch 4,875,826 3,795,612 2,952,214
Forest products 224,090 196,906 146,196
Rock products and sand 1,257,665 934,992 955,461
Oil lease and land rentals 831,254 679,039 677,712
Profit on sales of real estate 11,753,199 550,578 8,026,209
Interest and investment income 1,136,928 1,033,124 998,185
Other income 99,872 81,817 115,760
___________ ___________ ___________
Total revenue 47,432,677 36,088,836 39,570,983
___________ ___________ ___________
Costs and expenses (including charges
from affiliate) (note 9):
Citrus production, harvesting and
marketing 17,436,648 15,381,924 14,261,502
Sugarcane production, harvesting
and hauling 4,136,302 4,147,284 4,265,976
Ranch 4,110,969 5,429,239 2,446,117
Real estate 481,870 494,281 441,535
Interest (note 6) 444,217 990,082 1,175,599
Other, general and administrative
expenses 2,972,863 2,826,422 2,514,573
___________ ___________ ___________
Total costs and expenses 29,582,869 29,269,232 25,105,302
___________ ___________ ___________
Income before income taxes 17,849,808 6,819,604 14,465,681
Provision for income taxes (note 8) 6,677,116 2,380,414 5,524,311
___________ ___________ ___________
Net Income 11,172,692 $ 4,439,190 $ 8,941,370
___________ ___________ ___________
___________ ___________ ___________
Weighted average number of shares
outstanding 7,027,827 7,027,827 7,027,827
___________ ___________ ___________
___________ ___________ ___________
Per share amounts:
Net income $ 1.59 $ .63 $ 1.27
Dividends .15 $ .35 $ .25
See accompanying notes to consolidated financial statements.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Unrealized
Common Stock Gains On
Preferred Shares Retained Securi-
Stock Issued Amount Earnings ities
_____ _________ __________ ___________ _______
Balances, August 31, 1994 $ - 7,027,827 $7,027,827 $60,929,277 $ -
________________________
Net income for the year
ended August 31, 1995 - - - 8,941,370 -
Unrealized gains on
securities - - - - 264,739
Dividends paid - - - (1,756,957) -
______ _________ __________ ___________ ________
Balances, August 31, 1995 - 7,027,827 7,027,827 68,113,690 264,739
________________________
Net income for the year
ended August 31, 1996 - - - 4,439,190 -
Unrealized losses on
securities - - - - (3,053)
Dividends paid - - - (2,459,739) -
______ _________ __________ ___________ ________
Balances, August 31, 1996 - 7,027,827 7,027,827 70,093,141 261,686
________________________
Net income for the year
ended August 31, 1997 - - - 11,172,692 -
Unrealized gains on
securities - - - - 651,373
Dividends paid - - - (1,054,174) -
______ _________ __________ ___________ ________
Balances, August 31, 1997 $ - 7,027,827 $7,027,827 $80,211,659 $913,059
______ _________ __________ ___________ ________
______ _________ __________ ___________ ________
See accompanying notes to consolidated financial statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended August 31,
1997 1996 1995
___________ ___________ ___________
Increase (Decrease) in Cash and Cash Investments:
Cash flows from operating activities:
Net Income $11,172,692 $ 4,439,190 $ 8,941,370
Adjustments to reconcile net income to cash
provided by operating activities:
Depreciation and amortization 4,240,117 4,136,333 4,177,199
Gain on breeding herd sales (526,266) (255,277) (185,422)
Deferred income tax expense, net (259,533) (607,302) 2,906,324
Deferred retirement benefits (63,465) (130,828) (213,796)
Net gain on sale of marketable securities (414,669) (128,473) (14,511)
Road commitment payments (1,024,265) (401,698) (465,013)
Loss on sale of property and equipment 424,915 305,485 157,334
Gain on real estate sales (11,957,753) (379,734) (8,011,703)
Increase in land inventories (567,174) (455,202) (565,191)
Cash provided by (used for) changes in:
Accounts receivable 1,975,901 (2,443,469) (53,005)
Inventories (2,845,384) (227,391) (2,375,786)
Other assets (31,425) 94,118 14,758
Accounts payable and accrued expenses 433,271 126,145 (455,575)
Income taxes payable 744,256 (63,754) 198,090
___________ ___________ ___________
Net cash provided by operating activities 1,301,218 4,008,143 4,055,073
___________ ___________ ___________
Years Ended August 31,
1997 1996 1995
____________ ____________ ___________
Cash flows from investing activities:
Purchases of property and equipment (5,752,072) (7,141,814) (8,340,284)
Proceeds from disposals of property and equipment 608,658 364,398 233,813
Proceeds from sale of real estate 12,060,060 420,364 8,322,300
Purchases of other assets (100,896) (215,575) (115,108)
Proceeds from the sale of other assets 161,643 124,834 -
Purchases of marketable securities (4,694,859) (3,848,245) (1,900,519)
Proceeds from sales of marketable securities 4,367,008 3,756,639 1,622,586
Collection of mortgages and notes receivable 909,120 695,321 719,631
___________ __________ __________
Net cash provided by (used for)
investing activities 7,558,662 (5,844,078) 542,419
___________ __________ __________
Cash flows from financing activities:
Proceeds of bank loans 18,749,000 17,316,000 17,666,002
Repayment of loans (26,523,000) (12,741,000) (20,325,000)
Dividends paid (1,054,174) (2,459,739) (1,756,957)
___________ ___________ __________
Net cash provided by (used for)
financing activities (8,828,174) 2,115,261 (4,415,955)
___________ ___________ __________
Net increase in cash
and cash investments 31,706 279,326 181,537
Cash and Cash investments:
At beginning of year 1,428,059 1,148,733 967,196
___________ ___________ ___________
At end of year $ 1,459,765 $ 1,428,059 $ 1,148,733
___________ ___________ ___________
___________ ___________ ___________
Supplemental disclosures of cash flow information:
Cash paid for interest, net of amount capitalized $ 396,988 $ 886,239 $ 1,079,939
___________ ___________ ___________
___________ ___________ ___________
Cash paid for income taxes $ 6,183,310 $ 3,186,861 $ 2,419,600
___________ ___________ ___________
___________ ___________ ___________
See accompanying notes to consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years Ended August 31, 1997, 1996 and 1995
(1) Summary of Significant Accounting Policies
__________________________________________
(a) Basis of Consolidated Financial Statement Presentation
______________________________________________________
The accompanying financial statements include the accounts of
Alico, Inc. (the Company) and its wholly owned subsidiary,
Saddlebag Lake Resorts, Inc. (Saddlebag), 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. Fluctuation in the
market prices for citrus fruit has caused the Company to recognize
additional revenue from the prior year's crop totaling $1,007,211,
$1,087,921, and $1,770,146 during fiscal years 1997, 1996 and 1995,
respectively.
(c) Real Estate
___________
Real estate sales are recorded under the accrual method of
accounting. Retail land sales are not recognized until payments
received, including interest, aggregate 10 percent of the
contract sales price for residential real estate or 20 percent
for commercial real estate. Sales are discounted to yield 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 which approximates the relative sales value method.
(1), Continued
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
________________________________________
For the year ending August 31, 1995, the Company adopted
Statement of Financial Accounting Standards (SFAS) No. 115
"Accounting for Certain Investments in Debt and Equity
Securities".
Marketable securities available for sale are carried at the aggregate
estimated fair value of the portfolio. Aggregate net unrealized
investment gains or 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
___________
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.
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.
(g) 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 in-
come in the period that includes the enactment date.
(h) 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.
(i) Cash Flows
__________
For purposes of the cash flows, cash and cash investments include
cash on hand and amounts due from banks with an original maturity
of less than three months.
(j) Reclassifications
_________________
Certain amounts from 1996 and 1995 have been reclassified to
conform to the 1997 presentation.
(k) Use of Estimates
________________
In preparing the consolidated financial statements, management is
required to make estimates and assumptions that affect 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.
(l) Financial Instruments and Accruals
__________________________________
The carrying amounts in the consolidated balance sheets for accounts
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 debt approximate
fair value, because the instrument is a variable rate note which reprices
frequently.
(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 stock-
holders' equity until realized.
The amortized cost and estimated fair values of marketable securities
available for sale at August 31, 1997 and 1996 (in thousands) were as
follows:
1997 1996
__________________________________________ __________________________________________
Gross Estimated Gross Estimated
Unrealized Market Unrealized Market
Cost Gains Losses Value Cost Gains Losses Value
__________ ________ ________ __________ __________ ________ ________ __________
Equity
securities $7,793 $1,450 $48 $ 9,195 $6,486 $421 $107 $6,800
Debt
securities 2,155 76 13 2,218 2,721 119 14 2,826
______ ______ ___ _______ ______ ____ ____ ______
Marketable
securities
available
for sale $9,948 $1,526 $61 $11,413 $9,207 $540 $121 $9,626
______ ______ ___ _______ ______ ____ ____ ______
______ ______ ___ ______ ______ ____ ____ ______
At August 31, 1997, debt instruments (net of mutual funds of $1,040,007) are
collectible as follows: $2,000 within one year, $164,000 between one and five
years, $348,381 between five and ten years, and $601,102 thereafter.
(3) Notes Receivable
________________
Notes receivable include mortgage and other notes receivable.
Mortgage notes receivable arose principally from real estate sales.
The balances (in thousands) at August 31, 1997 and 1996 are as
follows:
1997 1996
______ ______
Mortgage notes receivable on
retail land sales, net $ 383 $ 448
Mortgage notes receivable on bulk land sales 936 1,735
Other notes receivable 171 216
______ ______
Total mortgage notes receivable 1,490 2,399
Less current portion 901 867
______ ______
Non-current portion $ 589 $1,532
______ ______
______ ______
At August 31, 1997, substantially all contracts and mortgages on
retail land sales were collectible over periods ranging from 1 to 10
years with expected maturities as follows: $45 thousand in 1998,
$68 thousand in 1999, $59 thousand in 2000, $53 thousand in 2001,
$50 thousand in 2002, and $108 thousand thereafter.
At August 31, 1997, notes receivable, other than those from retail
land sales, were collectible over periods ranging from 1 to 4 years
with expected maturities as follows: $856 thousand in 1998, $178
thousand in 1999, $8 thousand in 2000, and $65 thousand in 2001.
(4) Inventories
___________
A summary of the Company's inventories (in thousands) at August 31,
1997 and 1996 is shown below:
1997 1996
_______ _______
Unharvested fruit crop on trees $ 6,909 $ 7,064
Unharvested sugarcane 2,322 2,231
Beef cattle 6,993 3,937
Sod 163 53
_______ _______
Total inventories $16,387 $13,285
_______ _______
_______ _______
Subject to prevailing market conditions, the Company may hedge up to 50% of
its beef inventory by entering into cattle futures contracts to reduce
exposure to changes in market prices. The Company has designated these
agreements as a hedge and, therefore, any gains or losses anticipated under
these agreements will be deferred, with the cost of the related cattle
being adjusted when the contracts are settled.
(5) Property, Buildings and Equipment
_________________________________
A summary of the Company's property, buildings and equipment (in
thousands) at August 31, 1997 and 1996 is shown below:
Estimated Use-
1997 1996 ful Lives
_______ _______ ___________
Breeding herd $12,127 $13,184 5-7 years
Buildings 2,973 3,038 5-40 years
Citrus trees 19,820 20,109 22-40 years
Sugarcane 2,768 2,651 4-15 years
Equipment and other facilities 24,477 24,624 3-40 years
_______ _______
Total depreciable properties 62,165 63,606
Less accumulated depreciation 26,763 27,729
_______ _______
Net depreciable properties 35,402 35,877
Land and land improvements 34,544 33,424
_______ _______
Net property, buildings
and equipment $69,946 $69,301
_______ _______
_______ _______
The Company's citrus trees, fruit crop, unharvested sugarcane and cattle
are partially uninsured.
(6) Indebtedness
____________
The Company has unsecured financing agreements with commercial banks that permit
the Company to borrow up to $3,000,000 which is due on demand and up to
$27,000,000 which is due in January 1999. Under these agreements, there was no
current debt as of August 31, 1997 and 1996. The total amount of long-term debt
under this agreement at August 31, 1997 and 1996 was $12,856,000 and $20,630,000
respectively.
Interest cost expensed and capitalized (in thousands) during the three years
ended August 31, 1997, 1996 and 1995 was as follows:
1997 1996 1995
______ ______ ______
Interest expense $ 444 $ 990 $1,176
Interest capitalized 618 703 576
______ ______ ______
Total interest cost $1,062 $1,693 $1,752
______ ______ ______
______ ______ ______
(7) 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 $230,545, $223,152 and
$217,968 for the years ended August 31, 1997, 1996 and 1995, respectively.
Certain officers and employees also have employment contracts for additional
retirement benefits, the cost of which is accruable on a present value basis
over the remaining term of the employment agreements. The lives of such
officers and employees have been insured as a means of funding such additional
benefits. The accrued pension liability for these additional retirement
benefits at August 31, 1997 and 1996 was $3,133 and $56,088, 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, 1997 and 1996 was $10,126 and
$28,029, respectively.
Pension expenses for the additional retirement benefits were approximately
$217,000, $191,000 and $167,000 for the years ended August 31, 1997, 1996
and 1995, respectively.
(8) Income Taxes
____________
The provision for income taxes (in thousands) for the years ended August 31,
1997, 1996 and 1995 is summarized as follows:
1997 1996 1995
______ ______ ______
Current:
Federal income tax $5,919 $1,974 $1,980
State income tax 1,000 353 322
______ ______ ______
6,919 2,327 2,302
______ ______ ______
Deferred:
Federal income tax (207) 48 2,911
State income tax (35) 5 311
______ ______ ______
(242) 53 3,222
______ ______ ______
Total provision for
income taxes $6,677 $2,380 $5,524
______ ______ ______
______ ______ ______
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, 1997, 1996 and 1995:
1997 1996 1995
______ ______ ______
Expected income tax $6,069 $2,319 $4,918
Increase (decrease)
resulting from:
State income taxes, net
of federal benefit 648 248 525
Nontaxable interest
and dividends (120) (174) (180)
Other reconciling
items, net 80 (13) 261
______ ______ ______
Total provision for
income taxes $6,677 $2,380 $5,524
______ ______ ______
______ ______ ______
(8), Continued
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.
At August 31, 1997 the Company had an unused charitable contribution
carryover totaling $8,524,520. Management estimates that $1,000,000 will
be used to reduce taxable income over the next three years. As a result,
the estimated unusable portion of the carryover has been set up as the
valuation amount in the deferred tax asset schedule below. The contri-
bution carryover expires in 2000.
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):
1997 1996
_______ _______
Deferred Tax Assets:
Contribution carryover $(3,103) $(3,851)
Less valuation allowance 2,727 3,287
_______ _______
Net contribution carryover (376) (564)
Beef cattle inventory (131) (136)
Pension (84) (116)
Prepaid sales commissions (489) -
Other (133) (32)
_______ _______
Total gross deferred
tax assets (1,213) (848)
_______ _______
(8), Continued
1997 1996
_______ _______
Deferred Tax Liabilities:
Revenue recognized from
citrus and sugarcane 432 999
Deferred revenues 3,011 3,134
Property and equipment
(principally due to
depreciation and soil
and water deductions) 9,265 8,208
Mortgage notes receivable 348 643
Other 740 313
_______ _______
Total gross deferred
tax liabilities 13,796 13,297
_______ _______
Net deferred income
tax liabilities $12,583 $12,449
_______ _______
_______ _______
The Company is currently under examination by the Internal Revenue Service for
the years ended August 31, 1991, 1992, 1993 and 1994. When the examinations
are resolved, any income taxes due will become currently payable. However,
the majority of the proposed adjustments relate to the timing of certain income
and expense items already provided for in the Company's deferred tax liability
accounts.
Previously the Company had been under audit for the year ended August 31, 1990.
A final settlement was reached in August of 1997. Payments totaling
approximately $1.4 million resulted in a refund due of approximately $80
thousand. The items settled related to the timing of recognition of certain
items previously expensed. The aforementioned payments increased interest
expense by $124,784 and $263,000 during the fiscal years ended August 31, 1995
and 1996, respectively.
The adjustments proposed to date for the years ended August 31, 1991 and 1992
would potentially result in $3.3 million of additional income tax payments.
Management anticipates a settlement regarding these years to occur within the
next twelve months. No adjustments have yet been proposed for the years ended
August 31, 1993 and 1994.
(9) Related Party Transactions
__________________________
Citrus
______
Citrus revenues of $20,065,303, $20,386,090 and $17,398,420 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, 1997, 1996 and
1995, respectively. Griffin is the owner of 49.71 percent of the Company's
common stock. Accounts receivable, resulting from citrus sales, include
amounts due from Griffin totaling $5,549,080 and $7,758,469 at August 31, 1997
and 1996, 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 $7,335,825, $6,099,481, and $5,732,506 for the years
ended August 31, 1997, 1996 and 1995, respectively. In addition, Griffin
provided the harvesting services for citrus sold to an unrelated processor.
The aggregate cost of these services was $779,715, $767,144 and $764,082
for the years ended August 31, 1997, 1996 and 1995, respectively. The
accompanying balance sheets include accounts payable to Griffin for citrus
production, harvesting and processing costs in the amount of $383,614 and
$484,789 at August 31, 1997 and 1996, 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 $4,451,224, $5,535,086 and $4,190,784 during the years
ended August 31, 1997, 1996 and 1995, respectively.
(10) Commitment
__________
During October 1992 the Company entered into an agreement to donate land,
improvements and other items, to the State of Florida, to be used as a site
for a new university. The gift included 975 acres of land, road
construction, engineering and planning services, assistance with utility
costs and academic chairs. The commitment was recorded as a contribution
in May 1994 when the title to the land was transferred. Costs related to
road construction have been accrued and capitalized into land. Other costs
will be expensed as incurred.
(11) Business 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 (in thousands) for the years ended August 31, 1997, 1996
and 1995 is summarized as follows:
1997 1996 1995
________ ________ ________
Revenues:
Agriculture:
Citrus $ 22,287 $ 22,966 $ 19,674
Sugarcane 4,967 5,851 6,026
Ranch 4,876 3,796 2,952
________ ________ ________
Total agriculture 32,130 32,613 28,652
Real estate 11,753 551 8,026
General corporate 3,550 2,925 2,893
________ ________ ________
Consolidated total $ 47,433 $ 36,089 $ 39,571
________ ________ ________
________ ________ ________
Operating income (loss):
Agriculture:
Citrus $ 4,850 $ 7,584 $ 5,412
Sugarcane 831 1,704 1,760
Ranch 765 (1,633) 506
________ ________ ________
Total agriculture 6,446 7,655 7,678
Real estate 11,271 56 7,585
General corporate 3,550 2,925 2,893
________ ________ ________
Total operating income 21,267 10,636 18,156
Interest expense (444) (990) (1,176)
General corporate expenses (2,973) (2,826) (2,514)
________ ________ ________
Income before
income taxes $ 17,850 $ 6,820 $ 14,466
________ ________ ________
________ ________ ________
1997 1996 1995
________ ________ ________
Capital expenditures:
Agriculture:
Citrus $ 1,829 $ 2,734 $ 4,301
Sugarcane 1,890 967 743
Ranch 1,159 2,786 2,189
Sod 39 54 78
Farm lands 340 365 155
Heavy equipment 91 89 574
________ ________ ________
Total agriculture 5,348 6,995 8,040
General corporate 404 147 300
________ ________ ________
Consolidated total $ 5,752 $ 7,142 $ 8,340
________ ________ ________
________ ________ ________
1997 1996 1995
________ ________ ________
Depreciation, depletion and amortization:
Agriculture:
Citrus $ 1,818 $ 1,706 $ 1,731
Sugarcane 909 925 937
Ranch 1,101 1,040 1,035
Sod 17 49 81
Farm lands 19 11 5
Heavy equipment 306 311 295
________ ________ ________
Total agriculture 4,170 4,042 4,084
General corporate 70 94 93
________ ________ ________
Consolidated total $ 4,240 $ 4,136 $ 4,177
________ ________ ________
________ ________ ________
Identifiable assets:
Agriculture:
Citrus $ 45,361 $ 47,874 $ 43,449
Sugarcane 23,746 22,846 22,154
Ranch 16,355 13,710 12,619
Sod 379 247 1,474
Farm lands 1,561 1,240 887
Heavy equipment 1,246 1,461 1,699
________ ________ ________
Total agriculture 88,648 87,378 82,282
Real estate 9,835 10,177 10,417
General corporate 19,240 16,949 16,308
________ ________ ________
Consolidated total $117,723 $114,504 $109,007
________ ________ ________
________ ________ ________
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
assets consist principally of cash, temporary investments, mortgage notes
receivable 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, 1997 and August 31, 1996, is as follows:
Quarters Ended
November 30, Feb. 28, Feb. 29, May 31, August 31,
1996 1995 1997 1996 1997 1996 1997 1996
_______ _______ _______ _______ _______ _______ _______ _______
Revenue:
Citrus $ 2,093 $ 4,170 $ 9,826 $ 7,133 $ 8,527 $ 8,721 $ 1,841 $ 2,942
Sugarcane 1,078 1,386 3,518 4,022 153 355 218 88
Ranch 838 1,535 1,661 196 1,741 1,533 636 532
Property sales 24 17 11,384 80 15 91 330 363
Interest 244 352 351 260 353 234 189 187
Other revenues 535 364 494 429 661 506 723 592
_______ _______ _______ _______ _______ _______ _______ _______
Total revenue 4,812 7,824 27,234 12,120 11,450 11,440 3,937 4,704
_______ _______ _______ _______ _______ _______ _______ _______
Costs and expenses:
Citrus 1,789 3,375 8,596 5,631 5,916 5,090 1,136 1,286
Sugarcane 828 1,051 3,263 3,147 - - 45 (51)
Ranch 566 1,529 1,344 144 1,642 3,198 559 558
Interest 249 136 60 173 73 487 62 194
Other 816 748 744 866 673 585 1,222 1,122
_______ _______ _______ _______ _______ _______ _______ _______
Total costs and
expenses 4,248 6,839 14,007 9,961 8,304 9,360 3,024 3,109
_______ _______ _______ _______ _______ _______ _______ _______
Income before
income taxes 564 985 13,227 2,159 3,146 2,080 913 1,595
Provision for
income taxes 182 338 4,970 759 1,154 857 371 426
_______ _______ _______ _______ _______ _______ _______ _______
Net income $ 382 $ 647 $ 8,257 $ 1,400 $ 1,992 $ 1,223 $ 542 $ 1,169
_______ _______ _______ _______ _______ _______ _______ _______
_______ _______ _______ _______ _______ _______ _______ _______
Net income
per share $ .06 $ .09 $ 1.17 $ .20 $ .28 $ .17 $ .08 $ .17
_______ _______ _______ _______ _______ _______ _______ _______
_______ _______ _______ _______ _______ _______ _______ _______
The weighted average number of shares outstanding totaled 7,027,827 shares during each of the
periods presented above.
Item 9. Disagreements on Accounting and Financial Disclosure.
_______________________________________________________________________
There were no disagreements on accounting and financial disclosures.
PART III
________
Item 10. Directors and Executive Officers of the Registrant.
_____________________________________________________________________
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 Proxy Statement dated November 10, 1997.
Item 11. Executive Compensation.
_________________________________________
Item 12. Security Ownership of Certain Beneficial Owners and
_____________________________________________________________________
Management.
___________
Item 13. Certain Relationships and Related Transactions.
_________________________________________________________________
Information called for by Items 11, 12 and 13 is incorporated by
reference to Proxy Statement dated November 10, 1997.
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 Certified Public Accountants
Consolidated Balance Sheets - August 31, 1997 and 1996
Consolidated Statements of Operations - For the Years Ended
August 31, 1997, 1996 and 1995
Consolidated Statements of Stockholders' Equity - For the
Years Ended August 31, 1997, 1996 and 1995
Consolidated Statements of Cash Flows - For the Years Ended
August 31, 1997, 1996 and 1995
(a)2. Financial Statement Schedules:
_____________________________
Selected Quarterly Financial Data - For the Years Ended
August 31, 1997 and 1996 - Included in Part II, Item 8
Schedule I - Marketable Securities and Other Investments -
For Year Ended August 31, 1997
Schedule V - Property, Plant and Equipment - For the Years
Ended August 31, 1997, 1996 and 1995
Schedule VI - Reserves for Depreciation, Depletion and
Amortization of Property, Plant and Equipment - For the
Years Ended August 31, 1997, 1996 and 1995
Schedule IX - Supplementary Income Statement Information -
For the Years Ended August 31, 1997, 1996 and 1995
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 Principal - Not Applicable
(19) Annual Report to Security Holders - By Reference
(21) Subsidiaries of the Registrant - Not Applicable
(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 3, 1996 regarding re-election of
Directors and election of Officers.
* 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, 1997
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
________ ________ ________ ________ ________
Amount of Which
Each Portfolio
of Equity Secu-
rity Issues and
Number of Shares or Each Other Se-
Name of Issuer Units-Principal Market Value of Each curity Issue
and Title of Amounts of Bonds Issue at Balance Sheet Carried in the
Each Issue and Notes Cost of Each Issue Date Balance Sheet
______________ ________________ __________________ ______________________ _______________
Municipal Bonds $ 751,512 $ 751,512 $ 794,872 $ 794,872
Mutual Funds $4,607,653 4,607,653 5,833,612 5,833,612
Preferred Stocks 106,900 2,728,319 2,794,879 2,794,879
Common Stocks 35,778 1,282,737 1,416,313 1,416,313
Other Investments $ 578,591 578,591 573,239 573,239
__________ ___________ ___________
Total: $9,948,812 $11,412,915 $11,412,915
__________ ___________ ___________
__________ ___________ ___________
ALICO, INC.
SCHEDULE V
PROPERTY, PLANT AND EQUIPMENT
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ _________ _________ ___________ ______________ __________
Balance Other Changes Balance at
Beginning Additions Retirements Debit and/or Close of
Description of Period at Cost or Sales Credit-Describe Period
___________ _________ _________ ___________ ________________ ____________
For Year Ended August 31, 1997
______________________________
Land $14,504,916 $ 334,165 $ 470,119 $ $14,368,962
Roads 745,525 207,656 953,181
Agricultural Land Preparation 9,906 9,906
Forest Improvements 100,026 100,026
Pasture Improvements 2,801,321 155,453 2,956,774
Buildings 3,037,575 6,007 70,096 2,973,486
Feeding and Watering Facilities
for Cattle Herd 36,067 1,900 34,167
Water Control Facilities 871,337 866,000 5,337
Fences 270,133 34,484 12,420 292,197
Cattle Pens 134,955 134,955
Citrus Groves, Including
Irrigation Systems 38,634,654 1,532,126 1,744,166 38,422,614
Equipment 6,999,963 563,979 283,365 7,280,577
Breeding Herd 13,184,291 935,625 1,993,227 12,126,689
Sugarcane-Land Preparation, Etc. 14,304,486 1,603,607 630,792 15,277,301
Sod-Land Preparation, Etc. 141,922 39,016 180,938
Farm Land Preparation 1,252,376 339,954 1,592,330
___________ __________ __________ ________________ ___________
$97,029,453 $5,752,072 $6,072,085 $ 0 $96,709,440
___________ __________ __________ ________________ ___________
___________ __________ __________ ________________ ___________
ALICO, INC.
SCHEDULE V
PROPERTY, PLANT AND EQUIPMENT
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ _________ _________ ___________ ______________ ____________
Balance Other Changes Balance at
Beginning Additions Retirements Debit and/or Close of
Description of Period at Cost or Sales Credit-Describe Period
___________ _________ _________ __________ _______________ ___________
For the Year Ended August 31, 1996
__________________________________
Land $14,409,797 $ 133,396 $ 38,277 $ $14,504,916
Roads 489,213 256,312 745,525
Agricultural Land Preparation 9,906 9,906
Forest Improvements 100,026 100,026
Pasture Improvements 2,363,419 434,194 3,708 * 2,801,321
Buildings 3,034,835 82,938 80,198 3,037,575
Feeding and Watering Facilities
for Cattle Herd 36,486 419 36,067
Water Control Facilities 871,337 871,337
Fences 228,811 47,066 5,744 270,133
Cattle Pens 155,219 20,264 134,955
Citrus Groves, Including
Irrigation Systems 36,176,961 2,573,697 116,004 38,634,654
Equipment 6,815,062 328,372 143,471 6,999,963
Breeding Herd 12,094,179 2,165,878 1,075,766 13,184,291
Sugarcane-Land Prep.,Etc. 12,907,640 715,188 681,658 * 14,304,486
Sod-Land Preparation,Etc. 1,118,258 44,615 335,585 (685,366)* 141,922
Farm Land Preparation 892,218 360,158 1,252,376
___________ __________ __________ ___________ ___________
$91,703,367 $7,141,814 $1,815,728 $ 0 $97,029,453
___________ __________ __________ ___________ ___________
___________ __________ __________ ___________ ___________
* Reclassification
(/TABLE>
ALICO, INC.
SCHEDULE V
PROPERTY, PLANT AND EQUIPMENT
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
________ _________ _________ __________ _______________ ___________
Balance Other Changes Balance at
Beginning Additions Retirements Debit and/or Close of
Description of Period at Cost or Sales Credit-Describe Period
___________ _________ _________ ___________ _______________ ___________
For Year Ended August 31, 1995
______________________________
Land $14,574,228 $ 159,902 $ 324,333 $14,409,797
Roads 403,107 86,106 489,213
Agricultural Land Preparation 9,906 9,906
Forest Improvements 102,818 2,792 100,026
Pasture Improvements 1,997,036 366,383 2,363,419
Buildings 2,907,306 147,043 19,514 3,034,835
Feeding and Watering Facilities
for Cattle Herd 32,886 3,600 36,486
Water Control Facilities 871,337 871,337
Fences 188,806 79,107 39,102 228,811
Cattle Pens 118,149 44,658 7,588 155,219
Citrus Groves, Including
Irrigation Systems 32,761,874 3,611,450 196,363 36,176,961
Equipment 5,980,970 1,386,613 552,521 6,815,062
Breeding Herd 10,979,640 1,622,552 508,013 12,094,179
Sugarcane-Land Preparation,Etc. 12,761,667 629,125 483,152 12,907,640
Sod-Land Preparation,Etc. 1,080,849 48,305 10,896 1,118,258
Farm Land Preparation 736,778 155,440 892,218
___________ __________ __________ _________________ ___________
$85,507,357 $8,340,284 $2,144,274 $0 $91,703,367
___________ __________ __________ _________________ ___________
___________ __________ __________ _________________ ___________
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
Balance Charged To Other Changes Balance at
Beginning Profit & Loss Add (Deduct) Close of
Description of Period of Income Retirements Describe
___________ __________ __________ ___________ _______________ __________
For Year Ended August 31, 1997
______________________________
Buildings $ 1,152,448 $ 139,550 $ 70,096 $ 1,221,902
Feeding and Watering Facilities
for Cattle Herd 24,044 1,915 1,900 24,059
Water Control Facilities 866,000 866,000 0
Fences 112,016 24,421 12,420 124,017
Cattle Pens 43,362 13,951 57,313
Citrus Groves, Including
Irrigation Systems 10,189,551 1,448,900 1,744,166 9,894,285
Equipment 4,106,878 822,968 283,365 4,646,481
Breeding Herd 7,518,756 939,309 1,596,516 6,861,549
Roads 10,731 21,366 32,097
Sugarcane-Land Preparation,Etc. 3,683,734 807,626 630,791 3,860,569
Sod-Land Preparation,Etc. 2,054 1,903 3,957
Farm Land Preparation 19,353 18,208 37,561
___________ __________ __________ _______ ___________
$27,728,927 $4,240,117 $5,205,254 $0 $26,763,790
___________ __________ __________ _______ ___________
___________ __________ __________ _______ ___________
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
Balance Charged to Other Changes Balance at
Beginning Profit & Loss Add (Deduct) Close of
Description of period of Income Retirements Describe Period
___________ _________ _____________ _____________ _____________ ___________
For the Year Ended August 31, 1996
__________________________________
Buildings $ 1,092,981 $ 139,665 $ 80,198 $ $ 1,152,448
Feeding and Watering Facilities
for Cattle Herd 21,741 2,722 419 24,044
Water Control Facilities 866,000 866,000
Fences 96,330 21,430 5,744 112,016
Cattle Pens 49,676 13,951 20,265 43,362
Citrus Groves, Including
Irrigation Systems 9,002,178 1,303,376 116,003 10,189,551
Equipment 3,329,601 904,448 127,171 4,106,878
Breeding Herd 7,559,946 867,887 909,077 7,518,756
Roads 0 10,731 10,731
Sugarcane-Land Prep.,Etc. 2,752,281 827,397 104,056 * 3,683,734
Sod-Land Preparation,Etc. 174,201 33,524 101,615 (104,056)* 2,054
Farm Land Preparation 8,151 11,202 19,353
___________ __________ __________ _________ ___________
$24,953,086 $4,136,333 $1,360,492 $ 0 $27,728,927
___________ __________ __________ _________ ___________
___________ __________ __________ _________ ___________
* Reclassification
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
Balance Charged to Other Changes Balance at
Beginning Profit & Loss Add (Deduct) Close of
Description of Period or Income Retirements Describe Period
___________ _________ _____________ ___________ ___________ __________
For the Year Ended August 31, 1995
__________________________________
Forest Improvements $ 2,792 $ $ 2,792 $ 0
Buildings 974,796 137,700 19,515 1,092,981
Feeding and Watering Facilities
for Cattle Herd 19,034 2,707 21,741
Water Control Facilities 707,510 158,490 866,000
Fences 121,246 14,187 39,103 96,330
Cattle Pens 45,006 12,258 7,588 49,676
Citrus Groves, Including
Irrigation System 7,834,438 1,364,102 196,362 9,002,178
Equipment 2,924,537 866,991 461,927 3,329,601
Breeding Herd 7,120,195 855,410 415,659 7,559,946
Sugarcane-Land Preparation, Etc. 2,521,318 714,115 483,152 2,752,281
Sod-Land Preparation, Etc. 129,539 46,514 1,852 174,201
Farm Land Preparation 3,426 4,725 8,151
___________ __________ __________ __________ ___________
$22,403,837 $4,177,199 $1,627,950 $0 $24,953,086
___________ __________ __________ __________ ___________
___________ __________ __________ __________ ___________
ALICO, INC.
SCHEDULE IX
____________
SUPPLEMENTARY INCOME STATEMENT INFORMATION
__________________________________________
____________________________________________________________________________________________________
COLUMN A COLUMN B
____________________________________________________________________________________________________
Charged to Costs and Expenses
_____________________________
Years Ended August 31,
______________________
Item 1997 1996 1995
____ ____ ____ ____
1. Maintenance and repairs $ 990,184 $ 858,253 $ 948,602
2. Taxes, other than payroll
and income taxes 1,755,168 1,476,159 1,539,544
EXHIBIT 11
ALICO, INC.
Computation of Weighted Average Shares Outstanding as of August 31, 1997:
Number of shares outstanding at August 31, 1996 7,027,827
_________
_________
Number of shares outstanding at August 31, 1997 7,027,827
_________
_________
Weighted Average 9/1/96 - 8/31/97 7,027,827
_________
_________
EXHIBIT 12
ALICO, INC.
Computation of Ratios:
1996 Current Assets $34,876,632
Current Liabilities 5,114,866
34,876,632 divided by 5,114,866 = 6.82:1
1997 Current Assets $37,887,320
Current Liabilities 4,988,115
37,887,320 divided by 4,988,115 = 7.59:1
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 11, 1997 Ben Hill Griffin, III
Date President, Chief Executive
Officer and Director
(Signature)
November 11, 1997 W. Bernard Lester
Date Executive Vice President,
Chief Operating Officer and
Director
(Signature)
November 11, 1997 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:
J. C. Barrow, Jr. K. E. Hartsaw
Director Director
(Signature) (Signature)
Walker E. Blount, Jr. Lloyd G. Hendry
Director Director
(Signature) (Signature)
Ben Hill Griffin, IV Thomas E. Oakley
Director Director
(Signature) (Signature)
John C. Updike
Director
(Signature)
November 11, 1997
Date