Tropicana Supplier Alico to Shut Citrus Unit as Industry Suffers

Alico, Inc. (Nasdaq: ALCO), a leading agribusiness and land management company, has announced its decision to wind down its Alico Citrus division. This strategic move comes as the citrus industry faces significant challenges, including citrus greening disease, environmental factors, and hurricanes. The company's citrus production has declined by approximately 73% over the last decade, despite substantial investments in land, trees, and citrus disease treatments. The impact of recent hurricanes, such as Irma in 2017, Ian in 2022, and Milton in 2024, has further weakened Alico's citrus operations, making them economically unviable in Florida.

Alico's President and CEO, John Kiernan, stated, "We must now reluctantly adapt to changing environmental and economic realities... Growing citrus is no longer economically viable for us in Florida." The company plans to focus on its long-term diversified land usage and real estate development strategy, entitling certain parcels of its land for commercial and residential development. Alico expects to maintain its commitment to the Florida agriculture industry through diversified farming operations on nearly all its land holdings following this citrus production transition.

The closure of Alico's citrus unit is expected to have a significant impact on the company's revenue streams and profitability in the near term. However, Alico believes that this decision will ultimately improve its ability to provide investors with a greater return on capital in the long term. By focusing on real estate investments and diversified farming operations, Alico aims to create new opportunities for profitable growth while acting prudently on behalf of shareholders.



Alico's strategic shift towards diversified real estate investments is expected to have a positive impact on its long-term financial performance and shareholder value. The company owns approximately 53,371 acres of land across eight counties in Florida, as well as approximately 48,700 acres of oil, gas, and mineral rights in the state. By focusing on its land holdings and real estate development, Alico aims to create new opportunities for profitable growth while maintaining its commitment to the Florida agriculture industry. This strategic decision is expected to provide investors with a greater return on capital, including the benefits and stability of a conventional agriculture investment, with the optionality that comes with active land management.

In conclusion, Alico's decision to shut down its citrus unit and focus on diversified real estate investments is a strategic move that aligns with the company's long-term vision and the current market trends in the agribusiness sector. While the closure of the citrus unit may have a negative impact on Alico's revenue streams and profitability in the near term, the company believes that this decision will ultimately improve its long-term financial performance and shareholder value. By focusing on its land holdings and real estate development, Alico aims to create new opportunities for profitable growth while maintaining its commitment to the Florida agriculture industry.