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Business Observer Friday, Dec. 27, 2019 1 month ago

Juice machine: citrus company posts solid year

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Fort Myers-based Alico is one of the largest citrus producers in the country.

One of the largest citrus producers in the country, Fort Myers-based Alico, is delivering some good news for the holiday Season: The Florida orange isn’t dead yet.

Although the sunshine state’s No. 1 fruit has had a rough go for a few years, squeezed by storms and citrus greening, Alico’s fourth quarter and year-end report shows there could be a turn coming. For one, Alico Citrus, the company’s fruit division, harvested 8.1 million boxes of fruit for the fiscal year ended Sept. 30 — up 68.1% from the prior fiscal year. The company also posted a slight overall increase in pound solids per box, which was 5.91 for fiscal 2019, up from 5.64 from fiscal 2018.

“The increase was directly related to the negative impact of Hurricane Irma on the prior fiscal year harvest,” the company says in the Dec. 5 earnings report. “As a result of Hurricane Irma, the company experienced a greater amount of fruit drop and consequently harvested a smaller number of boxes in fiscal year 2018.”

The increased fruit harvest came fortuitously during a companywide modernization program, Alico 2.0, designed to cut costs, streamline groves and reshape management. That program was launched in 2017 and continued to bear fruit in fiscal 2019, company officials say. “The Alico 2.0 program saw the sale of several underperforming assets and a continued reduction in operating costs while investing in new plantings to create higher density in our groves,” Alico President and CEO John Kiernan says in the release. “I believe Alico is now an industry-leading high-quality, low-cost producer of citrus fruit in the U.S.”

A chunk of the data backs up Kiernan’s confidence. Net income attributable to common stockholders for fiscal 2019 was $37.8 million, up 189.9% from $13 million in 2018, the earnings report shows. Earnings before interest, taxes depreciation and amortization, earnings per diluted share and net cash from operations all grew significantly in 2019 over 2018. Also, the firm’s quarterly dividend increased 50%, to $0.09 per share for the quarter ending Dec. 31.

 

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