How do you interpret selling the land at $2,500 an acre? Obviously, the buyer bought land that he found desirable, but what does that mean for the value of the remaining land? Was this land sold at a higher price because it has desirable features in general or because it was desirable to this particular buyer?
If this sale is representative of the value of the remaining land the company has 135,000 acres at $2,500 or $347 million in land remaining. After tax the value drops to $226 million. Back out the companies $54 million in debt and that leaves $172 million. The current market cap is $174 million.
If the land is worth $1,500 per acre and the land that just sold was more valuable than that for some reason then the company's land is worth $132 million. Backing out he debt leaves $78 million.
yep, impairment loss on the Property of approximately $1.9 million which will impact the quarter ended June 30, 2012
but i don't see how alico can book a tax loss of $55 million on developable acreage with no income
My guess is we see it next quarter. Did you spot the writedown and $2 million deposit?
The rest of the report was loaded with all kinds of good news. Another 5,200 acres of sugar cane planted for next year. More orange grove acreage being planted. The next land sale proceeds in escrow. And the $55 million tax loss. The next few years are shaping up to be real strong.
Looks like no like kind exchange, but I imagine that the tax loss will take care of any tax liability.
A $55 million tax loss, assuming the company can utilize it over the next several years is worth about $17 million. It is like selling the land for $27 million. (ignoring time value of money factors)
The Company also expects to generate an approximate $19.5 million capital gain which may be utilized against the $45 million capital loss carryforward generated by the recent announced sales of certain Lee County property if the Company is not successful in identifying a like kind exchange property that fits our core businesses of agriculture and rural land management.
already $10 million less tax loss
Yeah, that is true, but unfortunately that is water long under the bridge. The recent land sale coupled with strong citrus and sugar cane sales hint that better days may be ahead.
I would have been awesome to have cashed out at the peak and I was a shareholder at the time and would have benefited greatly. The recent dip below $20 was too good to resist. I am not sure that the company can support a $70 price, but can easily see a $30 or $40 value being slapped on them.
The land is worth $4-$5000 an acre and the new university is in Lakeland while the land sold is in Frostproof, not anywhere close. They earned $1.01 last quarter and the sale will add about $1 when it closes, altogether about $4 for the year.
As I understand it ; the buyer is the brother in law of the CEO.The governer of Florida just signed a new law that porvides for a new university to be built near this land. Land near the new university surely will increase in value. The buyer has received a windfall.