Attached files
| file | filename |
|---|---|
| 8-K/A - FORM 8-K/A - TEJON RANCH CO | d794678d8ka.htm |
| EX-99.1 - EX-99.1 - TEJON RANCH CO | d794678dex991.htm |
| EX-99.2 - EX-99.2 - TEJON RANCH CO | d794678dex992.htm |
| EX-23.1 - EX-23.1 - TEJON RANCH CO | d794678dex231.htm |
Exhibit 99.3
TEJON RANCH CO. AND SUBSIDIARIES
Unaudited Pro Forma Information
Contents
| Introduction |
1 | |||
| Unaudited Pro Forma Combined Balance Sheet as of June 30, 2014 |
2 | |||
| Unaudited Pro Forma Combined Statements of Operations for the six months ended June 30, 2014 |
3 | |||
| Unaudited Pro Forma Combined Statements of Operations for the year ended December 31, 2013 |
4 |
TEJON RANCH CO. AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
Introduction
On July 16, 2014, Tejon Ranch Co. (the “Company”) filed with the Securities and Exchange Commission a Current Report on Form 8-K (the “Initial 8-K”) disclosing that on July 15, 2014, Tejon Ranchcorp (“TRC”), a wholly-owned subsidiary of the Company, entered into a Membership Interest Purchase Agreement (the “Agreement”), with DMB TMV LLC, (“DMB”), pursuant to which DMB agreed to sell its membership interest in Tejon Mountain Village LLC (“TMV LLC”) to TRC for $70,000,000 in cash (“Purchase Price”). The transaction contemplated by the Agreement closed simultaneously with the signing of the Agreement on July 15, 2014.
Pursuant to the Agreement, TRC paid DMB an initial payment of $10,000,000 in cash on July 15, 2014 and both parties executed an Assignment and Assumption of Membership Interest pursuant to which DMB transferred 100% of its membership interest in TMV LLC to TRC. TRC is required to pay DMB the remaining $60,000,000 of the Purchase Price on or before October 13, 2014, but has a one-time right to extend the final payment due date by thirty days. In the event TRC fails to pay the remaining $60,000,000 of the Purchase Price before the final payment due date (as such date may be extended), the Agreement, any related agreements and the transactions contemplated thereby will be void, DMB will continue to be a member of TMV LLC and DMB will have the right to retain the initial payment of $10,000,000.
The following unaudited pro forma condensed combined financial information of the Company presents the combined results of operations and financial position as they may have appeared had the acquisition and financing transactions described above occurred January 1, 2013.
The unaudited pro forma financial information are provided for illustrative purposes only and does not purport to present what the actual results of operations would have been had all the transactions actually occurred on the date indicated, nor does it purport to represent results of operations for any future period or financial position for any future date. This information does not reflect any cost savings or other benefits that may be obtained among the operations of the Company.
The unaudited pro forma combined financial information have been derived from and should be read together with the historical consolidated financial statements and notes of the Company and the historical financial statements of TMV LLC, both prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for the years ended December 31, 2013 and six months ended June 30, 2014.
TEJON RANCH CO. AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
JUNE 30, 2014
($ in thousands)
| Tejon Ranch Co. Historical |
TMV LLC Historical |
Pro Forma Adjustments |
Eliminations | Tejon Ranch Co. Pro Forma |
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| ASSETS |
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| Current Assets: |
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| Cash and cash equivalents |
1,898 | 365 | 12 | A | — | 2,275 | ||||||||||||||||||||||
| Marketable securities - available for sale |
52,844 | — | — | — | 52,844 | |||||||||||||||||||||||
| Accounts receivable |
4,958 | — | — | — | 4,958 | |||||||||||||||||||||||
| Inventories |
8,570 | — | — | — | 8,570 | |||||||||||||||||||||||
| Prepaid expenses and other current assets |
7,675 | — | — | — | 7,675 | |||||||||||||||||||||||
| Deferred tax assets |
637 | — | — | — | 637 | |||||||||||||||||||||||
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| Total Current Assets |
76,582 | 365 | 12 | — | 76,959 | |||||||||||||||||||||||
| Property and equipment - net depreciation |
154,373 | 101,393 | — | 255,766 | ||||||||||||||||||||||||
| Investments in unconsolidated joint ventures |
73,722 | — | 70,035 | B | (101,548 | ) | D | 42,209 | ||||||||||||||||||||
| Long-term water assets |
46,025 | — | — | — | 46,025 | |||||||||||||||||||||||
| Long-term deferred tax assets |
1,591 | — | — | — | 1,591 | |||||||||||||||||||||||
| Other Assets |
1,721 | — | — | — | 1,721 | |||||||||||||||||||||||
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| TOTAL ASSETS |
354,014 | 101,758 | 70,047 | (101,548 | ) | 424,271 | ||||||||||||||||||||||
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| LIABILITIES AND EQUITY |
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| Current Liabilities: |
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| Trade accounts payable |
2,699 | 85 | 16 | C | 2,800 | |||||||||||||||||||||||
| Accrued liabilities and other |
2,545 | 195 | — | — | 2,740 | |||||||||||||||||||||||
| Deferred income |
792 | — | — | — | 792 | |||||||||||||||||||||||
| Short term debt and current portion of long-term debt |
10,439 | — | — | — | 10,439 | |||||||||||||||||||||||
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| Total Current Liabilities |
16,475 | 280 | 16 | — | 16,771 | |||||||||||||||||||||||
| Long-term debt, less current portion |
4,338 | — | 70,000 | E | — | 74,338 | ||||||||||||||||||||||
| Long-term deferred gains |
2,248 | — | — | — | 2,248 | |||||||||||||||||||||||
| Other liabilities |
6,511 | — | — | — | 6,511 | |||||||||||||||||||||||
| Pension liability |
1,053 | — | — | — | 1,053 | |||||||||||||||||||||||
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| Total liabilities |
30,625 | 280 | 70,016 | — | 100,921 | |||||||||||||||||||||||
| Equity: |
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| Tejon Ranch Co. Stockholders’ Equity |
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| Common stock |
10,293 | — | — | — | 10,293 | |||||||||||||||||||||||
| Additional paid-in capital |
211,930 | 101,548 | — | (101,548 | ) | D | 211,930 | |||||||||||||||||||||
| Accumulated other comprehensive loss |
(3,203 | ) | — | — | — | (3,203 | ) | |||||||||||||||||||||
| Retained earnings |
64,772 | (70 | ) | 31 | 64,733 | |||||||||||||||||||||||
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| Total Tejon Ranch Co. Stockholers’ equity |
283,792 | 101,478 | 31 | (101,548 | ) | 283,753 | ||||||||||||||||||||||
| Non-controlling interest |
39,597 | 39,597 | ||||||||||||||||||||||||||
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| Total equity |
323,389 | 101,478 | 31 | (101,548 | ) | 323,350 | ||||||||||||||||||||||
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| TOTAL LIABILITIES AND EQUITY |
354,014 | 101,758 | 70,047 | (101,548 | ) | 424,271 | ||||||||||||||||||||||
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| A | Represents reversal of audit fees for stand alone TMV financials statements required by partnership. |
| B | Represents $70 million purchase of TMV interests and reversal of equity in losses related to TMV. |
| C | Represents tax effect of adjustments at effective tax rate of 34%. |
| D | Represents elimination of investment in TMV and related equity balance. |
| E | Represents debt incurred for purchase of TMV interest. |
2
TEJON RANCH CO. AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2014
($ in thousands, except for per share amounts)
| Tejon Ranch Co. Historical |
TMV LLC Historical |
Pro Forma Adjustments |
Tejon Ranch Co. Pro Forma |
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| Revenues: |
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| Real Estate - commercial/industrial |
5,495 | — | — | 5,495 | ||||||||||||||||
| Real Estate - resort/residential |
587 | — | — | 587 | ||||||||||||||||
| Mineral resources |
4,705 | — | — | 4,705 | ||||||||||||||||
| Farming |
4,366 | — | — | 4,366 | ||||||||||||||||
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| Total Revenues |
15,153 | — | — | 15,153 | ||||||||||||||||
| Costs and Expenses: |
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| Real Estate - commercial/industrial |
6,647 | — | — | 6,647 | ||||||||||||||||
| Real Estate - resort/residential |
1,573 | 70 | (12 | ) | A | 1,631 | ||||||||||||||
| Mineral resources |
227 | — | — | 227 | ||||||||||||||||
| Farming |
2,870 | — | — | 2,870 | ||||||||||||||||
| Corporate expenses |
6,032 | — | — | 6,032 | ||||||||||||||||
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| Total Expenses |
17,349 | 70 | (12 | ) | 17,407 | |||||||||||||||
| Operating Income(Loss) |
(2,196 | ) | (70 | ) | 12 | (2,254 | ) | |||||||||||||
| Other Income: |
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| Income from water sales |
3,179 | — | — | 3,179 | ||||||||||||||||
| Investment income |
383 | — | — | 383 | ||||||||||||||||
| Other Income |
47 | — | — | 47 | ||||||||||||||||
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| Total Other Income |
3,609 | — | — | 3,609 | ||||||||||||||||
| Income from operations before equity in earnings of unconsolidated joint ventures |
1,413 | (70 | ) | 12 | 1,355 | |||||||||||||||
| Equity in earnings of unconsolidated joint ventures, net |
1,586 | — | 35 | B | 1,621 | |||||||||||||||
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| Income before income tax expense(benefit) |
2,999 | (70 | ) | 47 | 2,976 | |||||||||||||||
| Income tax expense(benefit) |
1,020 | — | 16 | C | 1,036 | |||||||||||||||
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| Net Income |
1,979 | (70 | ) | 31 | 1,940 | |||||||||||||||
| Net loss attributable to non-controlling interest |
(8 | ) | — | — | (8 | ) | ||||||||||||||
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| Net income attributable to common stockholders |
1,987 | (70 | ) | 31 | 1,948 | |||||||||||||||
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| Net income per share attributable to common stockholders, basic |
0.10 | 0.09 | ||||||||||||||||||
| Net income per share attributable to common stockholders, diluted |
0.10 | 0.09 | ||||||||||||||||||
| A | Represents reversal of audit fees for stand alone TMV financials statements required by partnership. |
| B | Represents reversal of equity in losses related to TMV. |
| C | Represents tax effect of adjustments at effective tax rate of 34%. |
3
TEJON RANCH CO. AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 2013
($ in thousands, except for per share amounts)
| Tejon Ranch Co. Year ended Historical |
TMV LLC Historical |
Pro Forma Adjustments |
Tejon Ranch Co. Pro Forma |
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| Revenues: |
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| Real Estate - commercial/industrial |
11,148 | — | — | 11,148 | ||||||||||||||||
| Real Estate - resort/residential |
1,266 | — | — | 1,266 | ||||||||||||||||
| Mineral resources |
10,242 | — | — | 10,242 | ||||||||||||||||
| Farming |
22,682 | — | — | 22,682 | ||||||||||||||||
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| Total Revenues |
45,338 | — | — | 45,338 | ||||||||||||||||
| Costs and Expenses: |
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| Real Estate - commercial/industrial |
12,902 | — | — | 12,902 | ||||||||||||||||
| Real Estate - resort/residential |
3,351 | 117 | (17 | ) | A | 3,451 | ||||||||||||||
| Mineral resources |
462 | — | — | 462 | ||||||||||||||||
| Farming |
14,806 | — | — | 14,806 | ||||||||||||||||
| Corporate expenses |
12,641 | — | — | 12,641 | ||||||||||||||||
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| Total Expenses |
44,162 | 117 | (17 | ) | 44,262 | |||||||||||||||
| Operating Income(Loss) |
1,176 | (117 | ) | 17 | 1,076 | |||||||||||||||
| Other Income: |
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| Investment income |
941 | — | — | 941 | ||||||||||||||||
| Interest income(expense) |
— | — | — | — | ||||||||||||||||
| Other Income |
66 | — | — | 66 | ||||||||||||||||
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| Total Other Income |
1,007 | — | — | 1,007 | ||||||||||||||||
| Income from operations before equity in earnings of unconsolidated joint ventures |
2,183 | (117 | ) | 17 | 2,083 | |||||||||||||||
| Equity in earnings of unconsolidated joint ventures, net |
4,006 | — | 59 | B | 4,065 | |||||||||||||||
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| Income before income tax expense(benefit) |
6,189 | (117 | ) | 76 | 6,148 | |||||||||||||||
| Income tax expense(benefit) |
2,086 | — | 24 | C | 2,110 | |||||||||||||||
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| Net Income |
4,103 | (117 | ) | 52 | 4,038 | |||||||||||||||
| Net loss attributable to non-controlling interest |
(62 | ) | — | — | (62 | ) | ||||||||||||||
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| Net income attributable to common stockholders |
4,165 | (117 | ) | 52 | 4,100 | |||||||||||||||
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| Net income per share attributable to common stockholders, basic |
0.21 | 0.20 | ||||||||||||||||||
| Net income per share attributable to common stockholders, diluted |
0.20 | 0.20 | ||||||||||||||||||
| A | Represents reversal of audit and tax fees for stand alone TMV financials statements required by partnership. |
| B | Represents reversal of equity in losses related to TMV. |
| C | Represents tax effect of adjustments at effective tax rate of 31%. |
4