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fourthquarter20128k.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 25, 2013
Consolidated-Tomoka Land Co.
(Exact name of registrant as specified in its charter)
Florida
(State or other jurisdiction of incorporation)
001-11350
(Commission File Number)
59-0483700
(IRS Employer Identification No.)
 
 
1530 Cornerstone Boulevard, Suite 100
Daytona Beach, Florida
(Address of principal executive offices)
 
32117
(Zip Code)
 
Registrant’s telephone number, including area code: (386) 274-2202
 
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 
 
 
 
Item 2.02. Results of Operations and Financial Condition
On February 25, 2013, Consolidated-Tomoka Land Co., a Florida Corporation, issued a press release relating to the Company’s earnings for the fourth quarter and year-ended December 31, 2012. A copy of the press release is furnished as an exhibit to this report.
Item 9.01. Financial Statements and Exhibits
The following exhibit is furnished herewith pursuant to Item 2.02 of this Report and shall not be deemed to be “filed” for any purpose, including for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.
(d) Exhibits
99.1 Earnings Release, Dated February 25, 2013
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
CONSOLIDATED-TOMOKA LAND CO.
Date: February 26, 2013
/s/ Mark E. Patten
 
Mark E. Patten, Senior Vice President and Chief Financial Officer
 
 
fourthquarter2012release.htm
Press
Release
 
Contact:                 Mark E. Patten, Sr. Vice President and CFO
      mpatten@ctlc.com
Phone:                   (386) 944-5643
Facsimile:              (386) 274-1223
 
FOR
IMMEDIATE
RELEASE
 
CONSOLIDATED-TOMOKA LAND CO.
REPORTS FOURTH QUARTER AND YEAR-END 2012 EARNINGS
 
DAYTONA BEACH, FLORIDA, February 25, 2013. Consolidated-Tomoka Land Co. (NYSE MKT: CTO) today announced its operating results for the fourth quarter and year-ended December 31, 2012.
 
SIGNIFICANT ACTIVITIES
 
Operating results for the fourth quarter ended December 31, 2012 (compared to the same quarterly period in 2011):
 
·
Net income per share was $0.01 versus a net loss per share of ($0.10);
 
·
The quarter was impacted by an additional non-cash reserve of $111,367 related to previously disclosed litigation which commenced in 2010, an impact of approximately ($0.01) per share, after tax. Management believes that this reserve will be adequate to settle this litigation, but implementation of the settlement is not yet final;
 
·
The quarter results were also reduced by a $426,794 loss recognized for a property classified as held for sale in December, an impact of approximately ($0.05) per share, after tax;
 
·
Revenue from Income Properties totaled approximately $2.52 million, an increase of 11.8%;
 
·
Revenue from Real Estate Operations totaled $681,473, an increase of 126.5%; and
 
·
Revenue from Golf Operations decreased by 3.5%, while net operating losses improved by 70.2% totaling ($120,587).
 
Operating results for the year-ended December 31, 2012 (compared to year-ended 2011):
 
·
Net income per share was $0.10 versus a net loss per share of ($0.82);
 
·
The full year was impacted by non-recurring charges in the second half of the year, including $167,000 of separation costs for a retiring senior executive, and a non-cash legal reserve that totaled $723,058, related to previously disclosed litigation which commenced in 2010, an aggregate impact of approximately ($0.10) on net income per share, after tax;
 
·
Revenue from Income Properties totaled approximately $9.6 million, an increase of 8.9%;
 
·
Revenue from Real Estate Operations totaled approximately $3.1 million, an increase of nearly $2.6 million;
 
·
Revenue from Golf Operations decreased by 3.3%, while net operating losses improved by 33.4% or $445,271;
 
·
Net operating losses attributable to our agriculture operations, reflected as Other Income, improved by nearly $500,000 or 93.6%; and
 
·
The weighted average lease duration of our income property portfolio increased to 10.6 years as of December 31, 2012, from 9.0 years as of December 31, 2011.
 
 
 
 
 
OTHER HIGHLIGHTS
 
Other highlights for the year-ended December 31, 2012, include the following:
 
·
Book value increased by approximately $1.1 million since December 31, 2011, to $114,216,668 or $20.00 per share;
 
·
Acquired a total of eight income properties for $25.9 million diversifying into four new states with three new credits;
 
·
Sold two income properties for approximately $8.0 million with an average remaining lease term of 8.4 years;
 
·
Since January 2012, golf memberships nearly doubled through year-end 2012; and
 
·
Debt totaled approximately $29.1 million at December 31, 2012, with $32.9 million of available borrowing capacity on our credit facility, which was $62.0 million as of year-end, and total cash was approximately $1.3 million at December 31, 2012.
 
 
Financial Results
 
Revenue
Total revenue for the year-ended December 31, 2012, increased 23.2% to approximately $17.3 million, compared to approximately $14.1 million in 2011. This increase included a $783,862, or 8.9% increase, in revenue generated by our income properties and revenue from our real estate operations, which increased $2.6 million, or 517.8%, from the same period in 2011, reflecting revenue generated by a land transaction totaling $618,000, or more than $37,000 per acre, revenues from our subsurface leases, and the resolution of the Dunn Avenue commitment related to prior land transactions. Total revenues for the quarter-ended December 31, 2012, increased 15.3% to approximately $4.3 million compared to approximately $3.7 million during the same period in 2011. The growth in total revenues during the fourth quarter reflects an increase of 11.8% in revenue from our income properties, without the full benefit of the acquisitions closed in the latter part of the fourth quarter, and a 126.5% increase in revenue from our real estate operations, primarily from our subsurface leases, offset by slight decreases in golf revenues and other income.
 
Net Income (Loss)
Net income for the year-ended December 31, 2012, was approximately $600,000, an improvement of 112.7% compared to a loss of approximately $4.7 million in 2011. Our results in 2012 benefited from approximately $3.3 million or 23.2% in increased revenues and a reduction in direct cost of revenues of approximately $950,000 or 12.0%. Our general and administrative costs increased 21.8% or $1.2 million in 2012 due to a non-cash legal reserve of $723,058, a one-time separation payment to a retiring senior executive of $167,000 and increased stock compensation costs of $794,000. Excluding the non-recurring charges and the increase in non-cash stock compensation costs, our general and administrative costs totaled $4.9 million. Net income for the quarter-ended December 31, 2012, was $61,821, equivalent to $0.01 per share, compared to a net loss of $548,076, or ($0.10) per share, during the same period in 2011.
 
Income Property Portfolio Update
 
Property Acquisitions
In November, we acquired 0.6 acres of property leased to JPMorgan Chase Bank, N.A., pursuant to a ground lease in Chicago for $3.8 million with a remaining term of 28 years and rental rate escalations every 5 years, utilizing $3.7 million of proceeds received in the May 2012 sale of a property in Asheville, North Carolina.
 
In December, we acquired five properties for $12.8 million, leased for an initial term of 15 years to Bank of America, N.A., in Orange County, California.
 
At December 31, 2012, the Company owned 31 single-tenant properties in seven states, with an average remaining lease term of approximately 10.6 years. In addition, the Company owns 2 self-developed multi-tenant properties, with a weighted average occupancy of approximately 86%.
 
Semi-Annual Dividend
 
The Company paid dividends of $0.04 per share in 2012, which was unchanged from 2011. The Company has paid a dividend every year since 1976.
 
CEO Comments on Operating Results
 
John P. Albright, president and chief executive officer, stated, “We’re pleased with our improved results in 2012, our progress in growing and diversifying our single-tenant portfolio and the meaningful improvements we made in the operating results of our most challenging segments, golf and agricultural operations.” Mr. Albright further noted, “We are encouraged by the increased residential and commercial real estate activity we are seeing in the Daytona Beach area, as the state and national economic activity continues to improve.”
 
 
 
 
 
About Consolidated-Tomoka Land Co.
 
Consolidated-Tomoka Land Co. is a Florida-based publicly traded real estate company, which owns a portfolio of income properties in diversified markets in the United States as well as over 11,000 acres in the Daytona Beach area. Visit our website at www.ctlc.com.
 
Forward-Looking Statements
 
Certain statements contained in this press release (other than statements of historical fact) are forward-looking statements. The words “believe,” “estimate,” “expect,” “intend,” “anticipate,” “will,” “could,” “may,” “should,” “plan,” “potential,” “predict,” “forecast,” “project,” and similar expressions and variations thereof identify certain of such forward-looking statements, which speak only as of the dates on which they were made. Forward-looking statements are made based upon management’s expectations and beliefs concerning future developments and their potential effect upon the Company. There can be no assurance that future developments will be in accordance with management’s expectations or that the effect of future developments on the Company will be those anticipated by management.
 
The Company wishes to caution readers that the assumptions which form the basis for forward-looking statements with respect to or that may impact earnings for the year ended December 31, 2012, and thereafter include many factors that are beyond the Company’s ability to control or estimate precisely. For a description of the risks and uncertainties that may cause actual results to differ from the forward-looking statements contained in this press release, please see the Company’s filings with the Securities and Exchange Commission, including, but not limited to the Company’s most recent Annual Report on Form 10-K. Copies of each filing may be obtained from the Company or the SEC.
 
While the Company periodically reassesses material trends and uncertainties affecting its results of operations and financial condition, the Company does not intend to review or revise any particular forward-looking statement referenced herein in light of future events.
 
Disclosures in this press release regarding the Company’s quarter-end financial results are preliminary and are subject to change in connection with the Company’s preparation and filing of its Form 10-K for the year-ended December 31, 2012. The financial information in this release reflects the Company’s preliminary results subject to completion of the year-end review process. The final results for the year may differ from the preliminary results discussed above due to factors that include, but are not limited to, risks associated with final review of the results and preparation of financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CONSOLIDATED-TOMOKA LAND CO.
CONSOLIDATED BALANCE SHEETS
 
 
             
   
December 31,
    
December 31,
  
   
2012
    
2011
  
ASSETS
              
  Cash
  
$
1,301,739
    
$
6,174
  
  Restricted Cash
    
--
      
2,779,511
  
  Refundable Income Tax
    
239,720
      
399,905
  
  Land and Development Costs
    
27,848,525
      
27,825,924
  
  Intangible Assets - Net
    
4,527,426
      
3,572,096
  
  Assets Held for Sale
    
3,433,500
      
7,694,710
  
  Other Assets
    
8,254,399
      
8,023,872
  
   
$
45,605,309
    
$
50,302,192
  
                 
Property, Plant, and Equipment:
                
  Land, Timber, and Subsurface Interests
  
$
15,194,901
    
$
15,109,298
  
  Golf Buildings, Improvements, and Equipment
    
2,879,263
      
2,535,294
  
  Income Properties, Land, Buildings, and Improvements
    
132,202,887
      
111,564,673
  
  Other Furnishings and Equipment
    
906,441
      
2,320,766
  
  Total Property, Plant, and Equipment
    
151,183,492
      
131,530,031
  
  Less, Accumulated Depreciation and Amortization
    
(12,091,901
)
    
(11,566,420
)
  Net - Property, Plant, and Equipment
    
139,091,591
      
119,963,611
  
                 
   TOTAL ASSETS
  
$
184,696,900
    
$
170,265,803
  
                 
LIABILITIES
                
  Accounts Payable
  
$
440,541
    
$
385,685
  
  Accrued Liabilities
    
6,972,343
      
7,317,676
  
  Accrued Stock Based Compensation
    
265,311
      
484,489
  
  Pension Liability
    
1,317,683
      
1,586,513
  
  Deferred Income Taxes
    
32,357,505
      
32,060,283
  
  Notes Payable
    
29,126,849
      
15,266,714
  
                 
   TOTAL LIABILITIES
  
$
70,480,232
    
$
57,101,360
  
Commitments and Contingencies
               
                 
SHAREHOLDERS' EQUITY
                
  Common Stock – 25,000,000 shares authorized; $1 par value,
   5,844,203 issued and 5,829,569 shares outstanding at
  December 31, 2012; 5,829,464 issued and 5,829,464 outstanding at
  December 31, 2011
  
$
5,726,136
    
$
5,724,147
  
  Treasury Stock, at cost – 14,634 Shares held at December 31, 2012,
   with no shares held at December 31, 2011
    
(453,654
)
    
--
  
  Additional Paid in Capital
    
6,939,023
      
5,697,554
  
  Retained Earnings
    
103,242,643
      
102,872,167
  
  Accumulated Other Comprehensive Loss
    
(1,237,480
)
    
(1,129,425
)
                 
  TOTAL SHAREHOLDERS' EQUITY
  
$
114,216,668
    
$
113,164,443
  
                 
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
  
$
184,696,900
    
$
170,265,803
  
 
 
 
 
 
 
 
CONSOLIDATED-TOMOKA LAND CO.
CONSOLIDATED STATEMENTS OF OPERATIONS
 
 
   
Three Months Ended
    
Year-Ended
  
   
December 31,
    
December 31,
  
   
2012
    
2011
    
2012
    
2011
  
Revenues
                        
Income Properties
  
$
2,521,919
    
$
2,255,985
    
$
9,559,942
    
$
8,776,080
  
Real Estate Operations
    
681,473
      
300,914
      
3,098,840
      
501,626
  
Golf Operations
    
1,062,085
      
1,100,876
      
4,506,069
      
4,660,802
  
Other Income
    
18,350
      
56,998
      
164,979
      
124,776
  
Total Revenues
    
4,283,827
      
3,714,773
      
17,329,830
      
14,063,284
  
                                 
Direct Cost of Revenues
                                
Income Properties
    
(157,192
)
    
(152,297
)
    
(676,096
)
    
(526,959
)
Real Estate Operations
    
(173,149
)
   
(224,841
)
    
(705,062
)
    
(752,130
)
Golf Operations
    
(1,182,672
)
    
(1,505,095
)
    
(5,393,633
)
    
(5,993,637
)
Other Income
    
(32,414
)
    
(206,759
)
    
(198,834
)
    
(651,423
)
Total Direct Cost of Revenues
    
(1,545,427
)
    
(2,088,992
)
    
(6,973,625
)
    
(7,924,149
)
                                 
General and Administrative
    
(1,554,201
)
    
(2,033,107
)
    
(6,624,584
)
    
(5,440,721
)
Impairment Charges
    
--
      
--
      
--
      
(6,618,888
)
Depreciation and Amortization
    
(604,527
)
    
(736,636
)
    
(2,308,035
)
    
(2,450,037
)
Gain (Loss) on Disposition of Assets
    
(2,406
)
    
90,500
      
239,645
      
246,107
  
Total Operating Expenses
    
(3,706,561
)
    
(4,768,235
)
    
(15,666,599
)
    
(22,187,688
)
Operating Income (Loss)
    
577,266
      
(1,053,462
)
   
1,663,231
      
(8,124,404
)
Interest Income
    
665
      
3,789
      
1,485
      
160,369
  
Interest Expense
    
(134,958
)
    
(109,276
)
    
(536,018
)
    
(655,275
)
Loss on Early Extinguishment of Debt
    
--
      
--
      
(245,726
)
    
--
  
Income (Loss) from Continuing Operations
                                
Before Income Tax
    
442,973
      
(1,158,949
)
   
882,972
      
(8,619,310
)
Income Tax
    
(156,498
)
    
434,567
      
(323,078
)
    
3,380,852
  
Income (Loss) from Continuing Operations
    
286,475
      
(724,382
)
   
559,894
      
(5,238,458
)
Income from Discontinued Operations (net of tax)
    
(224,654
)
    
176,306
      
39,308
      
532,267
  
Net Income (Loss)
  
$
61,821
    
$
(548,076
)
 
$
599,202
    
$
(4,706,191
)
                                 
Per Share Information:
                                
Income (Loss) from Continuing Operations
  
$
0.05
    
$
(0.13
)
 
$
0.09
    
$
(0.91
)
Income (Loss) from Discontinued Operations (net of tax)
    
(0.04
)
    
0.03
    
$
0.01
    
$
0.09
  
Net Income (Loss)
  
$
0.01
    
$
(0.10
)
 
$
0.10
    
$
(0.82
)
                                 
 
 


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