Alico's Q2 2025 Earnings Call: Key Contradictions on Land Sales Strategy and Corkscrew Village Development

Land sales strategy and financial performance expectations, Corkscrew village development timeline, land sale confidence and financial performance expectations, Corkscrew Village construction timeline, and strategic direction and financial performance expectations are the key contradictions discussed in Alico's latest 2025Q2 earnings call.



Strategic Transformation and Land Monetization:
- Alico, Inc. reported a strategic transformation, reducing its workforce from approximately 200 to 25 employees and aligning its organizational structure with a transformed business model.
- The company achieved $20 million in land sales in fiscal year 2025, with potential for an additional $30 million, which represents a 150% increase from prior guidance.
- The acceleration in land sales is aimed at improving adjusted EBITDA and strengthening capital returns to shareholders.

Citrus Operations and Cost Management:
- Alico Citrus reported a decrease in revenue, with $18 million in Q2, down 1% from the prior year, and a decrease of 9% for the first six months, driven by hurricane impacts and the winding down of citrus operations.
- Revenue from Land Management and Other operations increased by 107% and 74%, respectively, due to increased rock and sand royalty income and sod sales.
- The reduction in citrus harvest volumes and strategic transformation led to significant cost savings and efficiencies.

Entitlement Work and Development Projects:
- Alico submitted development applications for the Corkscrew Grove Villages, which could accommodate approximately 4,500 homes each and 280,000 square feet of commercial space.
- The company plans to integrate residential, commercial, and civic spaces to create a mixed-use development that enhances convenience and shopping alternatives for residents.
- The entitlement process is expected to take approximately one year, with construction expected to begin in 2028 or 2029 if all approvals are granted.

Financial Performance and Cash Position:
- Alico reported a net loss attributable to common stockholders of $111.4 million in Q2, a significant increase from the prior year's loss of $15.8 million.
- The loss was primarily due to approximately $119.3 million of accelerated depreciation and impairment of young trees and assets.
- Despite the loss, Alico's cash and cash equivalents increased to $14.7 million as of March 31, 2025, up from $3.2 million at the end of fiscal year 2024.

Future Outlook and Land Value:
- Alico expects to generate approximately $20 million in adjusted EBITDA in fiscal year 2025, supported by land sales and cash generated from the 2024-2025 citrus harvest.
- The company projects that land sales could potentially exceed $50 million this year, which would increase adjusted EBITDA and cash and decrease net debt projections.
- Alico believes the present value of its current land holdings could be worth approximately $650 million to $750 million, with roughly 75% valued for agricultural use and 10% entitled for development within the next five years.