BBX Capital Corporation ("BBX Capital" and/or the "Company") (NYSE: BBX),
formerly BankAtlantic Bancorp, Inc., reported financial results for the three
and six month periods ended June 30, 2014.
BBX Capital reported net income of $7.2 million, or $0.43 per diluted share, for
the quarter ended June 30, 2014, versus a net loss of ($2.8) million, or ($0.18)
per diluted share, for the quarter ended June 30, 2013.
BBX Capital reported net income of $8.4 million, or $0.52 per diluted share, for
the six month period ended June 30, 2014, versus a net loss of ($9.4) million,
or ($0.59) per diluted share, for the comparable six month period ended June 30,
2013.
As of June 30, 2014, BBX Capital had total consolidated assets of $399.3
million, shareholders' equity attributable to BBX Capital of approximately
$312.7 million, and total consolidated equity of approximately $314.1 million.
BBX Capital's book value per share at June 30, 2014 was $19.54.
Overview and Highlights:
BBX Capital Selected Financial Data (Consolidated)
Second Quarter, 2014 Compared to Second Quarter, 2013
-- Total revenues of $22.9 million vs. $6.1 million
-- Net income of $7.2 million vs. Net loss of ($2.8) million
-- Diluted earnings (loss) per share of $0.43 vs. ($0.18)
-- Book value per share was $19.54 vs. $15.53
-- Total assets were $399.3 million vs. $442.0 million
-- BB&T's preferred interest in FAR was $27.0 million vs. $154.5 million
(BB&T's preferred interest in FAR was $16.4 million as of July 31, 2014)
-- Real estate was $131.1 million vs. $73.9 million
-- Loans receivable were $39.5 million vs. $227.1 million
-- Loans held-for-sale were $46.6 million vs. $19.0 million
BBX Capital Selected Financial Data (Consolidated)
Six Months Ended June 30, 2014 Compared to Six Months Ended June 30, 2013
-- Total revenues of $44.1 million vs. $13.0 million
-- Net income of $8.4 million vs. Net loss of ($9.4) million
-- Diluted earnings (loss) per share of $0.52 vs. ($0.59)
BBX Capital's Chairman and CEO, Mr. Alan B. Levan, commented, "We are pleased
with the results and momentum during the quarter. As we discussed in our BBX
Capital Corporate Overview, since the sale of BankAtlantic in July 2012, our
corporate strategy is to focus on repositioning our business by monetizing our
legacy portfolios, and pursuing our goal of transitioning into a growth business
by focusing on real estate opportunities and operating businesses. Our results
during the three and six month periods of 2014 reflect our pursuit of this
strategy. As a reminder, we invite our readers to review the BBX Capital
Corporate Overview, which was filed by the Company with the SEC on April 16,
2014, and is available to view on the BBX Capital website: www.BBXCapital.com.
In that document we discussed our corporate strategy, but more importantly we
discussed who we are and how we are approaching our business:
"First, our culture is entrepreneurial. Our objective is to make portfolio
investments based on the fundamentals: quality real estate, the right operating
companies and partnering with good people.
"Second, our goal is to increase value over time as opposed to focusing on
quarterly or yearly earnings. Since we expect our investments to be longer term,
we anticipate and are willing to accept that our earnings are likely to be
uneven. While capital markets generally encourage short term goals, our
objective is long term growth as measured by increases in book value per share
over time."
The following provides financial and other information regarding our assets,
including our investment in Bluegreen and acquired operating businesses, our
real estate joint ventures, and our BankAtlantic legacy portfolio of loans and
foreclosed real estate.
BBX Capital Partners
Investments and Acquisitions of Operating Companies
BBX Capital, through its BBX Capital Partners Division, is actively engaged in
investments in operating companies. Our goal at BBX Capital is to diversify our
assets so that a meaningful percentage of our assets and income will be derived
from operating businesses. It is our objective that the investments and
acquisitions sourced by BBX Capital Partners will diversify our overall company
risk profile and contribute more consistent cash flows and earnings over time.
The following is a summary of the Company's investments in operating businesses:
Bluegreen Corporation: On April 2, 2013, BBX Capital acquired a 46% interest in
Woodbridge Holdings, LLC ("Woodbridge"). BFC Financial Corporation ("BFC"), BBX
Capital's parent company, owns the remaining 54% of Woodbridge. Woodbridge's
principal asset is its 100% ownership of Bluegreen Corporation ("Bluegreen").
For the quarter ended June 30, 2014, net income attributable to Woodbridge was
$17.6 million, of which $18.3 million related to the operations of Bluegreen.
BBX Capital recognized 46% of the net income attributable to Woodbridge, or $8.1
million, for the quarter ended June 30, 2014. For the six month period ended
June 30, 2014, net income attributable to Woodbridge was $31.2 million, of which
$32.5 million related to the operations of Bluegreen. BBX Capital recognized 46%
of the net income attributable to Woodbridge, or $14.3 million, for the six
month period ended June 30, 2014.
During the second quarter of 2013 and the first and second quarters of 2014,
Bluegreen paid cash dividends of $20.0 million, $14.5 million, and $19.0
million, respectively, to Woodbridge. Woodbridge paid cash dividends of $19.1
million, $13.9 million, and $18.4 million, respectively, to its members during
June 2013, April 2014, and June 2014, which were distributed pro rata to BBX
Capital (46%) and BFC (54%), based on their percentage ownership interests in
Woodbridge.
Bluegreen Highlights for the Second Quarter, 2014 Compared to Second Quarter 2013
-- System-wide sales of Vacation Ownership Interests ("VOIs") were $139.0
million vs. $116.4 million
-- Legacy sales of VOIs under Bluegreen's traditional business model
were $46.8 million vs. $65.9 million
-- Sales of VOIs under Bluegreen's "capital-light" business strategy
(1) were $92.2 million vs. $50.5 million
-- Secondary market sales of VOIs were $17.3 million vs. $3.8
million
-- Just-in-time sales of VOIs were $9.7 million vs. $5.9 million
-- Sale of third party VOIs - commission basis were $65.2 million
vs. $40.9 million and generated sales and marketing commissions
of $43.2 million vs. $26.7 million
-- Other fee-based revenue rose 13% to $23.0 million.
-- Bluegreen managed 48 timeshare resort properties as of June 30, 2014,
compared to 45 as of June 30, 2013.
-- Income from continuing operations was $20.3 million vs. $12.1 million
-- EBITDA was $37.6 million vs. $23.5 million
-- Income from continuing operations before income taxes was $31.7 million
vs. $17.7 million
-- Operating profit was $31.2 million vs. $17.5 million
(1) Bluegreen's sales of VOIs under its capital-light business strategy
include sales of VOIs under fee-based sales and marketing arrangements,
Just-In-Time inventory acquisition arrangements where Bluegreen enters
into agreements with third party developers that allow Bluegreen to buy
VOI inventory from time to time in close proximity to the time when
Bluegreen intends to sell such VOIs and Secondary Market arrangements
pursuant to which Bluegreen acquires VOI inventory from resorts'
property owner associations and other third parties through foreclosure
in connection with maintenance fee defaults, and generally at a
significant discount, close to the time when Bluegreen intends to sell
such VOIs.
System-wide sales of VOIs, net include all sales of VOIs, regardless of whether
Bluegreen or a third-party owned the VOI immediately prior to the sale. The
sales of third-party owned VOIs are transacted as sales of timeshare interests
in the Bluegreen Vacation Club through the same selling and marketing process
Bluegreen uses to sell its VOI inventory. The growth in system-wide sales of
VOIs, net during the 2014 period as compared to the same period in 2013 reflects
an increase in the number of sales tours and an increase in the sale-to-tour
conversion ratio. During the three months ended June 30, 2014, the number of
sales tours increased by 8% compared to the same periods in 2013. The increase
in the number of sales tours reflects efforts to expand marketing to sales
prospects through new marketing initiatives. Additionally, during the three
months ended June 30, 2014, Bluegreen's sale-to-tour conversion ratio to new
prospects increased 11% compared the same period in 2013.
During the three months ended June 30, 2014 and 2013, cost of VOIs sold were 13%
of sales of VOIs. Cost of VOIs sold as a percentage of sales of VOIs may vary
between periods based on the relative costs of the specific VOIs sold in each
period and the size of the point packages of the VOIs sold (due to offered
volume discounts, including consideration of cumulative sales to existing
owners). Additionally, the effect of changes in estimates under the relative
sales value method, including estimates of project sales, future defaults,
upgrades and incremental revenue from the resale of repossessed VOI inventory,
are reflected on a retrospective basis during the period in which the change
occurs. Therefore, cost of sales will typically be favorably impacted in periods
where a significant amount of Secondary Market VOI inventory is acquired and the
resulting change in estimate is recognized.
The $12 million increase in selling and marketing expenses during the second
quarter of 2014 compared to the same period in 2013 was a result of Bluegreen's
focus on increasing its marketing efforts to new customers as opposed to
existing owners, as marketing to new customers has a higher marketing cost.
Bluegreen intends to continue to emphasize expanding marketing to new customers
and, as a result, sales and marketing expenses generally, and as a percentage of
sales, may continue to increase.
During the three months ended June 30, 2014, Legacy sales of VOIs declined to
$46.8 million versus $65.9 million in the comparable 2013 period. This decline
reflects Bluegreen's continued focus on its capital-light business strategy and
its efforts to achieve selling and marketing efficiencies through new marketing
channels. Bluegreen believes its capital-light business strategy enables it to
leverage its expertise in resort management, sales and marketing, mortgage
servicing, title services, and construction management to generate recurring
revenues from third parties.
______________________________________
BBX Capital Partners (continued)
Investments and Acquisitions of Operating Companies
Renin Holdings: In October 2013, Renin Holdings, LLC ("Renin"), a newly formed
joint venture entity owned 81% by BBX Capital and 19% by BFC, acquired
substantially all of the assets and certain liabilities of Renin Corp. Renin
manufactures and sells interior and closet doors, wall décor, associated
systems and hardware and fabricated glass products through a portfolio of brand
name and private label offerings including Erias, DSH, Acme, KingStar, TRUporte,
Ramtrack and JJ Home Products. With facilities in Canada, the U.S. and the
United Kingdom, Renin is in a position to service distribution channels
including big box building and home improvement supply retailers, home centers,
distributors, other building supply manufacturers, volume builders and specialty
retailers throughout North America and other markets. Renin had revenues of
approximately $14.8 million and $28.9 million during the three and six month
periods ended June 30, 2014, respectively.
BBX Sweet Holdings: In December 2013, BBX Sweet Holdings, a wholly-owned
subsidiary of BBX Capital which operates under the BBX Capital Partners
Division, acquired Hoffman's Chocolates and in January 2014 it acquired Williams
& Bennett. In July 2014, BBX Sweet Holdings acquired California based Jer's
Chocolates and Helen Grace Chocolates. These acquisitions are not yet considered
material to the Company's financial condition or results of operation as of or
for the six month period ended June 30, 2014. BBX Sweet Holdings is actively
pursuing other acquisitions in the candy and confections industry.
-- Helen Grace Chocolates: Headquartered in Lynwood, California, Helen
Grace Chocolates has been creating premium chocolate confections,
chocolate bars, chocolate candies, and truffles for 70 years. For many
years, Helen Grace Chocolates has helped schools and other organizations
reach their fundraising goals through sales of their premium boxed
chocolates, chocolate bars and other products, sold exclusively through
the national fundraising programs of Innisbrook Wraps™. As part of the
transaction, Helen Grace will continue to be the exclusive provider of
chocolate and chocolate gift items to Innisbrook.
-- Jer's Chocolates: Headquartered in Solana Beach near San Diego,
California, Jer's Chocolates, with its Award Winning premier peanut
butter chocolate products, has created a niche in the gourmet luxury
chocolate market. With its core flavors of chocolate and natural peanut
butter, Jer's specialties include its gourmet peanut butter chocolate
confections, which come in its patented "Double Grin" shaped assorted
chocolate boxes, Peanut Butter Bars and Squares. Jer's corporate gift
chocolate boxes and peanut butter chocolate gift boxes have been
featured on the Home Shopping Network, QVC, The Food Network, and the
Rachael Ray Show. Jer's Chocolates is available to customers through
wholesale distribution channels in the U.S. and internationally, as well
as through the Jer's Chocolates licensed retail location in the San
Diego International Airport.
-- Williams & Bennett: Headquartered in Boynton Beach, Florida, Williams &
Bennett is a Florida based manufacturer of quality chocolate products
since 1992. Williams & Bennett sells chocolate products and confections
through distribution channels serving boutique retailers, big box
chains, department stores, national resort properties, corporate
customers, and private label brands.
-- Hoffman's Chocolates: Headquartered in Lake Worth, Florida, Hoffman's
Chocolates is a manufacturer of gourmet chocolates, with retail
locations in Palm Beach County, Florida, and plans to open stores in
Fort Lauderdale later this year. Its product line includes over 70
varieties of confections, which are available via its retail stores,
online distribution channels, direct shipping throughout the U.S., and
at third party retail locations nationwide.
BBX Capital Real Estate
Real Estate Investments and Acquisitions
Our real estate activities, including the BankAtlantic legacy loan and
foreclosed real estate portfolios, fall under the umbrella of our BBX Capital
Real Estate Division. As previously announced, we are liquidating some legacy
real estate while holding and managing others for capital appreciation and
development. We are also pursuing new real estate development opportunities,
unrelated to the legacy portfolios.
We are currently actively engaged in real estate development and operating
activities involving real estate obtained through foreclosure and real estate
purchased from third parties, including land entitlement activities, property
renovations, asset management, and pursuing joint venture opportunities
involving the contribution of these properties and/or cash investments in joint
ventures with third party development partners.
BankAtlantic Legacy Assets - Loans and Real Estate:
Assets transferred to BBX Capital in connection with the consummation in July
2012 of the sale of BankAtlantic to BB&T Corporation (referred to as the "BB&T
Transaction") were primarily loans receivable, real estate held-for-sale and
real estate held-for-investment. BBX Capital also holds assets previously
transferred from BankAtlantic. These transferred assets are considered our
"Legacy Assets". These Legacy Assets are held by BBX Capital in CAM (BBX Capital
Asset Management) and BBX Partners, which are wholly owned subsidiaries; and in
FAR (Florida Asset Resolution Group). FAR was formed in connection with the BB&T
Transaction when BankAtlantic contributed to FAR certain performing and
non-performing loans, tax certificates and foreclosed real estate. Upon
consummation of the BB&T Transaction, BBX Capital transferred to BB&T
Corporation a 95% preferred interest in the net cash flows of FAR which BB&T
Corporation will hold until such time as it has recovered $285 million in
preference amount plus a priority return of LIBOR + 200 basis points per annum
on any unpaid preference amount. At that time, BB&T Corporation's interest in
FAR will terminate, and the Company will thereafter be entitled to any and all
residual proceeds from FAR as its sole owner. At June 30, 2014, BB&T
Corporation's preference amount had been reduced to $27.0 million. As of July
31, 2014, the BB&T Corporation's preference amount had been reduced to $16.4
million.
CAM and BBX Partners Loans: The composition of CAM and BBX Partners legacy loans
were (dollars in thousands):
---------------------------- ----------------------------
As of June 30, 2014 As of December 31, 2013
---------------------------- ----------------------------
Unpaid Unpaid
Loans held-for- Principal Carrying Principal Carrying
investment: Number Balance Amount Number Balance Amount
------- --------- -------- ------- --------- --------
Loans receivable:
Commercial non-
real estate:
Accruing - $ - $ - - $ - $ -
Non-accruing 2 3,097 1,362 3 5,107 3,331
Commercial real
estate:
Accruing 1 2,130 2,130 1 2,152 2,152
Non-accruing 3 22,211 8,218 4 27,077 11,526
------- --------- -------- ------- --------- --------
Total loans held-
for-investment 6 $ 27,438 $ 11,710 8 $ 34,336 $ 17,009
======= ========= ======== ======= ========= ========
------- --------- -------- ------- --------- --------
Loans held-for-
sale - $ - $ - - $ - $ -
======= ========= ======== ======= ========= ========
CAM and BBX Partners Real Estate: The composition of CAM and BBX Partners real
estate was (dollars in thousands):
----------------------- -----------------------
As of June 30, 2014 As of December 31, 2013
----------------------- -----------------------
Carrying Carrying
Number Amount Number Amount
---------- ----------- ---------- -----------
Real estate held-for-
investment:
Land 14 $ 58,202 13 $ 75,333
Rental properties 1 10,762 2 15,705
Other 1 789 1 789
---------- ----------- ---------- -----------
Total real estate held-for-
investment 16 $ 69,753 16 $ 91,827
========== =========== ========== ===========
Real estate held-for-sale:
Land 10 $ 22,839 10 $ 10,307
---------- ----------- ---------- -----------
Total real estate held-for-
sale 10 $ 22,839 10 $ 10,307
========== =========== ========== ===========
FAR Loans: The composition of FAR's legacy loans were (dollars in thousands):
---------------------------- ----------------------------
As of June 30, 2014 As of December 31, 2013
---------------------------- ----------------------------
Unpaid Unpaid
Loans held-for- Principal Carrying Principal Carrying
investment: Number Balance Amount Number Balance Amount
------- --------- -------- ------- --------- --------
Loans receivable:
Commercial non-
real estate:
Accruing - $ - $ - - $ - $ -
Non-accruing - - - - - -
Commercial real
estate:
Accruing 6 8,613 8,613 7 15,245 15,245
Non-accruing 5 30,422 13,010 10 52,108 34,014
Consumer
Accruing 55 5,056 5,056 62 5,646 5,646
Non-accruing 43 6,122 3,022 43 5,846 2,972
Residential:
Accruing - - - - - -
Non-accruing - - - 2 189 53
------- --------- -------- ------- --------- --------
Total loans held-
for-investment 109 $ 50,213 $ 29,701 124 $ 79,034 $ 57,930
======= ========= ======== ======= ========= ========
Loans held-for-
sale:
Commercial real
estate
Accruing - $ - $ - - $ - $ -
Non-accruing - - - - - -
Consumer
Accruing 14 1,905 1,343 15 2,044 1,494
Non-accruing 26 3,441 2,386 31 4,135 2,682
Residential
Accruing 35 4,897 3,902 34 4,912 3,945
Non-accruing 233 53,283 31,168 255 58,603 34,278
Small business
Accruing 37 6,834 5,504 52 10,320 8,170
Non-accruing 12 3,369 2,338 17 4,204 3,277
------- --------- -------- ------- --------- --------
Total loans held-
for-sale 357 $ 73,729 $ 46,641 404 $ 84,218 $ 53,846
======= ========= ======== ======= ========= ========
FAR Real Estate: The composition of FAR's real estate was (dollars in thousands):
----------------------- -----------------------
As of June 30, 2014 As of December 31, 2013
----------------------- -----------------------
Carrying Carrying
Number Amount Number Amount
---------- ----------- ---------- -----------
Real estate held-for-
investment:
Land 1 $ 2,850 3 $ 4,323
Rental properties 2 20,429 1 11,186
---------- ----------- ---------- -----------
Total real estate held-for-
investment 3 $ 23,279 4 $ 15,509
========== =========== ========== ===========
Real estate held-for-sale:
Land 9 $ 9,166 8 $ 7,961
Rental properties 1 1,748 3 6,168
Residential single-family 22 3,781 29 6,447
Other 19 487 23 3,088
---------- ----------- ---------- -----------
Total real estate held-for-
sale 51 $ 15,182 63 $ 23,664
========== =========== ========== ===========
Legacy assets acquired by FAR:
Villa San Michele: In January 2014, FAR acquired an 82-unit, 272 bed student
housing project located in Tallahassee, Florida, through a contractual
settlement with the borrower. Built in 2008, the Villa San Michele is located in
southwest Tallahassee near Tallahassee Community College. The project includes a
mix of 3 bedroom and 4 bedroom 2-story townhomes, as well as a 10.6 acre parcel
of vacant land. FAR has engaged a property management company specializing in
student housing to manage the day to day operations and leasing of the property.
Villa San Michele had a carrying value of $11.5 million as of June 30, 2014.
(Villa San Michele is included in the FAR table above.)
Eagle's Point: In September 2013, FAR acquired a 168-unit, 336 bed student
housing project located adjacent to Tallahassee Community College in
Tallahassee, Florida, through a contractual settlement with the borrower. The
residential units at Eagle's Point consists of 2-story, 2 bedroom townhomes. FAR
has engaged a property management company specializing in student housing to
manage the day to day operations and leasing of the property. FAR is also
embarking on a capital improvement program to renovate units, common areas, and
various amenities. Eagle's Point had a carrying value of $8.9 million as of June
30, 2014. (Eagle's Point is included in the FAR table above.)
RoboVault: In April 2013, FAR acquired RoboVault, a 155,000 square foot
high-tech, robotic self-storage facility, featuring climate controlled, and high
security storage. Located in Fort Lauderdale, Florida, RoboVault provides its
clients museum quality storage for business, forensic property, and personal
prized possessions, including art, wine collections, cars, gems, antiques,
important documents and files, and other collectibles. RoboVault's additional
services include crating, handling, moving, and shipping and storage services
for its clients throughout the United States and Europe. Built in 2009, the
facility is wind resistant up to 200 mph (a category 5 hurricane), stores items
30 feet above sea level, uses a biometric robotic transfer system, and offers 24
hour - 7 day access. RoboVault had a carrying value of $7.7 million as of June
30, 2014. (RoboVault is included in "properties and equipment" in the Company's
Consolidated Statement of Financial Condition.)
The Company has investments in the following real estate joint ventures:
Bonterra - CC Devco Homes: In July 2014, the Company entered into a joint
venture agreement with CC Devco Homes- a Codina-Carr Company, to develop in a
portion of the newly proposed Bonterra Communities (formerly called the Hialeah
Communities) in Hialeah, Florida. As the developer and manager of the joint
venture, CC Devco Homes currently plans to build approximately 394 single-family
homes. The Company transferred approximately 50 acres of land at an agreed upon
value of approximately $15.6 million subject to an $8.3 million mortgage which
was assumed by the joint venture. In exchange, BBX Capital received its joint
venture interest and $2.2 million of cash. Anticipated project profits resulting
from the joint venture will be distributed to CC Devco Homes and BBX Capital on
a 55% and 45% basis, respectively. Capital requirements for the joint venture
will be contributed by CC Devco Homes and BBX Capital on a 43% and 57% basis,
respectively. The project is in the final stages of planning and subject to
receipt of government approvals. Construction and sales are anticipated to
commence in the first half of 2015. (The Bonterra - CC Devco Homes joint venture
is part of the master-planned community project, Bonterra Communities, discussed
below.)
Bayview: In June 2014, the Company entered into a joint venture agreement with
an affiliate of Procacci Development Corporation. The joint venture acquired for
approximately $8.0 million three acres of real estate located at Bayview Drive
and Sunrise Boulevard in Fort Lauderdale, Florida. The new joint venture entity,
Sunrise and Bayview Partners, LLC, is a 50% - 50% joint venture between BBX
Capital and an affiliate of Procacci Development. The property is currently
improved with an approximate 84,000 square foot office building along with a
convenience store and gas station, and located minutes from the Fort Lauderdale
beaches and directly across from the Galleria at Ft. Lauderdale. The office
building has low occupancy with short term leases. The convenience store's lease
ends in March 2017 with a five year extension. We anticipate the property will
be repurposed at some point in the future.
Village at Victoria Park: Village at Victoria Park consists of approximately 2
acres of vacant land located near downtown Fort Lauderdale, Florida. In December
2013, the Company entered into a joint venture agreement with New Urban
Communities to develop the project as 30 single-family homes. The project is a
50% - 50% joint venture, with New Urban Communities serving as the developer and
manager. In April 2014, the joint venture executed an acquisition, development
and construction loan with a financial institution and the Company and New Urban
Communities each contributed an additional $692,000 to the joint venture as a
capital contribution. The joint venture purchased the vacant land from the
Company for $3.6 million consisting of $1.8 million in cash (less $0.2 million
in selling expenses) and a $1.6 million promissory note. The $1.6 million
promissory note is secured by a junior lien on the vacant land and future
improvements. The project is currently scheduled to commence construction and
sales in the third quarter of 2014. Closings are projected to begin by the third
quarter of 2015.
Kendall Commons: In March 2013, the Company sold land to Altman Development
("Altman"), a third party real estate developer, for net proceeds of $8.0
million. Altman is developing a multifamily rental community comprised of 12
three-story apartment buildings, one mixed-use building and one clubhouse
totaling 321 apartment units. The Company has invested $1.3 million of cash in
the project as one of a number of investors. The development is currently under
construction and scheduled to begin leasing during the third quarter of 2014.
The Company is entitled to receive 13% of venture distributions until a 15%
internal rate of return has been attained and thereafter the Company will be
entitled to receive 9.75% of any venture distributions.
North Flagler: In October 2013, the Company entered into a joint venture with
JRG USA pursuant to which JRG USA assigned to the joint venture a contract to
purchase for $10.8 million a 4.5 acre parcel overlooking the Intracoastal
Waterway in West Palm Beach Florida and the Company invested $0.5 million of
cash. The joint venture is seeking to expand land entitlements and is currently
working to amend the current zoning designation and increase the parcel's
residential height restrictions with a view to increasing the value of the
parcel. The Company is entitled to receive 80% of any joint venture
distributions until it recovers its capital investment and thereafter will be
entitled to receive 70% of any joint venture distributions. The entitlement
process is currently expected to be concluded in 2015.
The Company also owns a 2.7 acre parcel located adjacent to the 4.5 acre parcel
which is the subject of the contract held by the North Flagler joint venture
with JRG USA. The 2.7 acre parcel was acquired by the Company through
foreclosure and had a carrying value of $3.2 million as of June 30, 2014. We
believe that the fair value of this parcel will increase if the density is
increased by the municipality's approval of the zoning changes referenced in the
preceding paragraph.
PGA Design Center Holdings, LLC: In December 2013, the Company purchased for
$6.1 million a commercial property in Palm Beach Gardens, Florida, with three
existing buildings consisting of 145,000 square feet of mainly furniture retail
space. The property, which is located in a larger mixed use property now known
as PGA Place, was substantially vacant at the date of acquisition. Subsequent to
the acquisition of the property, the Company entered into a joint venture with
Stiles Development which acquired a 60% interest in the joint venture for $2.9
million in cash. The Company contributed the property (excluding certain
residential development entitlements having an estimated value of $1.2 million)
to the joint venture in exchange for $2.9 million in cash and the remaining 40%
interest in the joint venture. The Company transferred the retained residential
development entitlements to adjacent parcels owned by it. (The adjacent parcels
are referred to as PGA Place. Please see below for a discussion of the other
parcels owned by the Company in PGA Place). The joint venture intends to seek
governmental approvals to change the use of a portion of the property from
retail to office and subsequently sell or lease the property.
The following development projects are currently in the planning stages and
involve real estate held-for-investment included in the above CAM and BBX
Partners real estate table.
Bonterra Communities: Bonterra Communities (formerly called Hialeah Communities)
is a proposed master-planned community anticipated to be built on an approximate
128 acres of land consisting of a 114 acre parcel owned by BBX Capital having a
carrying value of $30.7 million at June 30, 2014, and approximately 14 acres of
adjacent land which is currently under contract to be acquired by the Bonterra -
CC Devco Homes joint venture discussed above. Once completed, Bonterra
Communities is planned to have approximately 1,171 single-family homes, villas,
town homes, and apartments, along with amenities including a clubhouse, fitness
center, resort pool, parks, and a 15 acre lake. The Bonterra community site is
currently in the final stages of master-planning and our plans continue to be
subject to receipt of governmental approvals. It is anticipated that the
community will be divided into three parcels, which include:
1. As discussed in the Bonterra - CC Devco Homes joint venture paragraph
above, an approximate 59 acre parcel (including approximately 9 acres
under contract to acquire) to be developed with approximately 394
single-family homes by a joint venture between BBX Capital and CC Devco
Homes - a Codina-Carr Company.
2. An approximate 14 acre parcel owned by BBX Capital to be developed with
approximately 314 rental apartment units. BBX Capital Real Estate is
currently seeking required entitlements and plans to partner with a
third party developer to develop this parcel.
3. An approximate 55 acre parcel (including 5 acres under contract to be
acquired by the CC Devco Homes joint venture) owned by BBX Capital to be
developed with approximately 463 additional single-family homes, villas
and townhomes. The Company has a contract to sell this parcel, subject
to the receipt of entitlements currently being sought and due diligence
by the purchaser.
Gardens at Millenia: Gardens at Millenia consists of 37 acres of land located
near the Mall at Millenia in a commercial center of Orlando, Florida with a
carrying value of $11.2 million as of June 30, 2014. This site is currently in
the planning process and the final size and density of the project is subject to
governmental approvals and other conditions. The proposed plans for 26 acres of
this site include a 300,000 square foot retail shopping center with multiple
big-box and in-line tenants as well as four outparcel retail pads. The Company
is in discussions with a potential joint venture partner to develop a portion of
the 26 acre parcel. Current plans for the remaining 11 acres of this site
include nine rental apartment buildings totaling approximately 280 units, a
clubhouse, lakeside pavilion, lakeside running trail, and a dog park. The
Company is in discussions with a potential joint venture partner to develop the
eleven acre parcel.
PGA Place: The Company owns an office building and land located in the newly
named PGA Place, in the city of Palm Beach Gardens, Florida, with carrying
values aggregating $14.4 million as of June 30, 2014. The property held by the
PGA Design Center Holdings joint venture described above is adjacent to PGA
Place. We believe this property presents a variety of development opportunities,
some of which are currently in the planning stages and remain subject to receipt
of government approvals. These include:
-- Office and Multi-Use - This mixed use property includes a 33,000 square
foot commercial leased office building that is currently 56% occupied
with an attached 428 space parking garage. Additionally, the Company is
currently seeking governmental approvals for a 125 room limited-service
suite hotel, a 5,000 square foot freestanding restaurant and a 60,000
square foot office building on vacant tracts of land adjacent to this
office building. We anticipate partnering with a third party developer
to develop all or a portion of these components of the project.
-- Multi-family - Current plans for an additional seven acre multifamily
parcel include approximately 300 apartment units, a clubhouse and spa,
and lakeside pavilion. The Company is in discussions with a potential
joint venture partner to develop this parcel.
BBX Capital Corporation - BFC Financial Corporation
Proposed Merger:
In May 2013, BBX Capital entered into a merger agreement with BFC. The Merger
Agreement provides for BBX Capital to merge with and into a subsidiary of BFC,
with the surviving company remaining a wholly owned subsidiary of BFC. Under the
terms of the Merger Agreement, which was approved by a special committee
comprised of the Company's independent directors as well as the full boards of
directors of both BFC and the Company, the Company's shareholders (other than
BFC and shareholders of the Company who exercise and perfect their appraisal
rights in accordance with Florida law) will be entitled to receive 5.39 shares
of BFC's Class A Common Stock in exchange for each share of the Company's Class
A Common Stock that they hold at the effective time of the Merger. The Merger
Agreement was approved by the Company's shareholders and by BFC's shareholders
on April 29, 2014. Consummation of the Merger is subject to certain closing
conditions, including, without limitation, BFC's Class A Common Stock being
approved for listing on a national securities exchange (or interdealer quotation
system of a registered national securities association) at the effective time of
the Merger, and the absence of any "Material Adverse Effect" (as defined in the
Merger Agreement) with respect to either the Company or BFC. The Merger is not
anticipated to close prior to the first quarter of 2015.
Financial data is provided in the supplemental financial tables included in this
release for BBX Capital Corporation, Woodbridge Holdings, LLC and Bluegreen
Corporation.
For more detailed information regarding Bluegreen and its financial results,
business, operations and risks, see BFC's financial results press release for
the quarter ended June 30, 2014, BFC's Quarterly Report on Form 10-Q for the
quarter ended March 31, 2014, and BFC's Annual Report on Form 10-K for the year
ended December 31, 2013, which is available on the SEC's website, www.sec.gov
and/or BFC's website, www.BFCFinancial.com
More complete and detailed information regarding BBX Capital and its financial
results, business, operations and risks, and the proposed merger with BFC
Financial Corporation, is available in the Company's Quarterly Report on Form
10-Q for the quarter ended March 31, 2014, and its Annual Report on Form 10-K
for the year ended December 31, 2013, which is available to view on the SEC's
website, www.sec.gov, or on BBX Capital's website, www.BBXCapital.com.
_____________________________
About BBX Capital Corporation:
BBX Capital, a New York Stock Exchange listed company (NYSE: BBX), is involved
in the acquisition, ownership and management of, and joint ventures and
investments in real estate and real estate development projects as well as
investments and management of middle market operating businesses. In addition,
BBX Capital and its holding company, BFC Financial Corporation, have a 46% and
54% indirect ownership interest in Bluegreen Corporation. Bluegreen manages,
markets and sells the Bluegreen Vacation Club, a flexible, points-based, deeded
vacation ownership plan with more than 180,000 owners, over 60 owned or managed
resorts, and access to more than 4,000 resorts worldwide.
As of June 30, 2014, BBX Capital had total consolidated assets of $399.3
million, shareholders' equity attributable to BBX Capital of approximately
$312.7 million, and total consolidated equity of approximately $314.1 million.
BBX Capital's book value per share at June 30, 2014 was $19.54.
For further information, please visit our family of companies:
BBX Capital: www.BBXCapital.com
Bluegreen Corp.: www.BluegreenVacations.com
Renin Corp.: www.ReninCorp.com
BBX Sweet Holdings: Hoffman's Chocolates: www.Hoffmans.com, Williams & Bennett:
www.WilliamsandBennett.com, Jer's Chocolates: www.Jers.com and Helen Grace
Chocolates: www.HelenGrace.com
RoboVault: www.RoboVault.com
BFC Financial Corporation: www.BFCFinancial.com
About BFC Financial Corporation :
BFC (OTCQB: BFCF) is a holding company whose principal holdings include a 52%
ownership interest in BBX Capital Corporation (NYSE: BBX) and a 54% indirect
ownership interest in Bluegreen Corporation. As of June 30, 2014, BFC had total
consolidated assets of approximately $1.4 billion, shareholders' equity
attributable to BFC of approximately $252.5 million, and total consolidated
equity of approximately $445.6 million. For more information, visit
www.BFCFinancial.com.
This press release contains forward-looking statements based on current
expectations that involve a number of risks and uncertainties. All opinions,
forecasts, projections, future plans or other statements, other than statements
of historical fact, are forward-looking statements and may include words or
phrases such as "plans," "believes," "will," "expects," "anticipates,"
"intends," "estimates," "our view," "we see," "would" and words and phrases of
similar import. The forward looking statements in this press release are also
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended (the "Securities Act"), and Section 21E of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and involve
substantial risks and uncertainties. We can give no assurance that such
expectations will prove to be correct. Future results could differ materially as
a result of a variety of risks and uncertainties, many of which are outside of
the control of management. These risks and uncertainties include, but are not
limited to the impact of economic, competitive and other factors affecting the
Company and its assets, including the impact of decreases in real estate values
or high unemployment rates on our business generally, the ability of our
borrowers to service their obligations and the value of collateral securing our
loans; credit risks and loan losses, and the related sufficiency of the
allowance for loan losses, including the impact of the economy and real estate
market values on our assets and the credit quality of our loans; the risk that
loan losses will continue and the risks of additional charge-offs, impairments
and required increases in our allowance for loan losses; the impact of and
expenses associated with litigation including but not limited to litigation
brought by the SEC; adverse conditions in the stock market, the public debt
market and other financial and credit markets and the impact of such conditions
on our activities; the risk that the assets retained by the Company in CAM and
FAR may not be monetized at the values currently ascribed to them; and the risks
associated with the impact of periodic valuation of our assets for impairment.
In addition, this press release contains forward looking statements relating to
the Company's ability to successfully implement its currently anticipated
business plans, which may not be realized as anticipated, if at all, and the
Company's investments in real estate developments, real estate joint ventures
and operating businesses may not achieve the returns anticipated or may not be
profitable, including the Company's investment in Woodbridge, its acquisition of
Renin Corp., and its acquisitions by BBX Sweet Holdings in the candy and
confections industry. The Company's investments in real estate developments,
either directly or through joint ventures, will increase exposure to downturns
in the real estate and housing markets and expose us to risks associated with
real estate development activities, including risks associated with obtaining
necessary zoning and entitlements, and the risk that our joint venture partners
may not fulfill their obligations. The Company's investment in Woodbridge, which
owns Bluegreen Corporation, exposes the Company to risks inherent in the
time-share industry, which risks are identified in BFC's Annual Report on Form
10-K filed on March 17, 2014 with the SEC and available on the SEC's website,
www.sec.gov. The Company's acquisition of Hoffman's, Williams & Bennett, Jer's
Chocolates, Helen Grace Chocolates and Renin Corp. exposes us to the risks of
their respective businesses, which in the case of Renin includes foreign
currency exchange risk of the U.S. dollar compared to the Canadian dollar and
Great Britain Pound, as well as the risk that the integration of these operating
businesses may not be completed effectively or on a timely basis, and that the
Company may not realize any anticipated benefits or profits from the
transactions. This press release also contains forward looking statements
regarding the Company's proposed Merger with BFC which is subject to risks
relating to the ability to realize the expected benefits from the Merger, the
ability of the parties to satisfy all of the conditions to the closing of the
Merger, including BFC's ability to obtain the listing of its Class A Common
Stock on a national securities exchange (or qualified interdealer quotation
system), litigation that has been brought challenging the Merger, and that the
Merger may not otherwise be consummated in accordance with its terms, or at all.
Past performance and perceived trends may not be indicative of future results.
In addition to the risks and factors identified above, reference is also made to
other risks and factors detailed in reports filed by the Company with the
Securities and Exchange Commission, including the Company's Annual Report on
Form 10-K for the year ended December 31, 2013, and its Quarterly Report on Form
10-Q for the quarter ended March 31, 2014. BBX Capital cautions that the
foregoing factors are not exclusive.
Additional Information Regarding the Proposed Merger between the Company and BFC
and Where to Find it
BFC has filed a Registration Statement on Form S-4 with the Securities Exchange
Commission (the "SEC"), which has been declared effective, and the Company and
BFC have mailed to their respective shareholders a joint proxy
statement/prospectus concerning the Merger. The Company and BFC may also file
other documents with the SEC regarding the Merger. Investors and shareholders of
the Company and BFC are urged to read the joint proxy statement/prospectus and
other relevant documents filed with the SEC carefully and in their entirety
because they contain important information. Investors and shareholders of the
Company and BFC can obtain copies of the joint proxy statement/prospectus and
other relevant documents filed with the SEC free of charge from the SEC's
website at www.sec.gov. Copies of the documents filed with the SEC by the
Company are also available free of charge on the Company's website at
www.bbxcapital.com under the tab "Investors -- SEC Filings" or by directing a
request by mail to BBX Capital Corporation, 401 East Las Olas Boulevard, Suite
800, Fort Lauderdale, Florida 33301, Attention: Corporate Secretary, or by
calling 954-940-4000. Copies of the documents filed with the SEC by BFC are
available free of charge on BFC's website at www.bfcfinancial.com under the tab
"Investor Relations -- Regulatory Info -- SEC Filings" or by directing a request
by mail to BFC Financial Corporation, 401 East Las Olas Boulevard, Suite 800,
Fort Lauderdale, Florida 33301, Attention: Corporate Secretary, or by calling
954-940-4900. This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of any vote or
approval.
BBX Capital Corporation and Subsidiaries
Consolidated Statements of Financial Condition - Unaudited
June 30, December 31,
(In thousands, except share data) 2014 2013
-------------- -------------
ASSETS
Cash and interest bearing deposits in banks
($2,777 and $8,686 in Variable Interest Entities
("VIE")) $ 47,881 43,138
Loans held for sale ($46,641 and $53,846 in VIE) 46,641 53,846
Loans receivable, net of allowance for loan
losses of $1,881 and $2,713 ($27,818 and
$56,170, net of allowance of $1,881 and $1,759
in VIE) 39,530 72,226
Real estate held for investment ($23,692 and
$15,836 in VIE) 93,032 107,336
Real estate held for sale ($15,183 and $23,664 in
VIE) 38,021 33,971
Investment in unconsolidated real estate joint
ventures 7,437 1,354
Investment in Woodbridge Holdings, LLC 78,057 78,573
Properties and equipment, net ($7,730 and $7,899
in VIE) 14,688 14,824
Inventories 10,899 9,155
Goodwill and other intangible assets 4,377 2,686
Other assets ($1,332 and $2,413 in VIE) 18,732 14,038
------------- -------------
Total assets $ 399,295 431,147
============= =============
LIABILITIES AND EQUITY
Liabilities:
BB&T preferred interest in FAR, LLC ($26,986 and
$68,517 in VIE) $ 26,986 68,517
Notes payable to related parties 11,750 21,662
Notes payable 16,871 9,034
Other liabilities ($12,785 and $12,355 in VIE) 29,539 28,368
------------- -------------
Total liabilities 85,146 127,581
------------- -------------
Commitments and contingencies
Equity:
Preferred stock, $.01 par value, 10,000,000 shares
authorized;
none issued and outstanding - -
Class A common stock, $.01 par value, authorized
25,000,000
shares; issued and outstanding 15,810,588 and
15,778,088 shares 158 158
Class B common stock, $.01 par value, authorized
1,800,000
shares; issued and outstanding 195,045 and 195,045
shares 2 2
Additional paid-in capital 346,976 345,300
Accumulated deficit (34,442) (43,091)
Accumulated other comprehensive income 47 13
------------- -------------
Total BBX Capital Corporation shareholders' equity 312,741 302,382
Noncontrolling interest 1,408 1,184
------------ ------------
Total equity 314,149 303,566
------------- -------------
Total liabilities and equity $ 399,295 431,147
============= =============
BBX Capital Corporation and Subsidiaries
Consolidated Statements of Operations - Unaudited
For the Three Months For the Six Months
Ended June 30, Ended June 30,
------------------------ -----------------------
(In thousands, except share
and per share data) 2014 2013 2014 2013
------------ ----------- ----------- -----------
Revenues:
Sales $ 15,804 - 32,671 -
Interest income 1,282 2,373 3,058 5,418
Net gains on the sales of
assets 3,926 2,194 3,877 4,256
Income from real estate
operations 1,473 1,194 2,966 2,430
Other 448 387 1,489 879
----------- ----------- ----------- -----------
Total revenues 22,933 6,148 44,061 12,983
----------- ----------- ----------- -----------
Costs and expenses:
Cost of goods sold 11,445 - 23,546 -
BB&T's priority return in
FAR distributions 222 906 553 1,919
Interest expense 463 334 959 503
Real estate operating
expenses 1,938 1,392 3,491 2,468
Selling, general and
administrative expenses 11,924 6,658 23,425 14,843
----------- ----------- ----------- -----------
Total costs and expenses 25,992 9,290 51,974 19,733
----------- ----------- ----------- -----------
Equity earnings in
Woodbridge Holdings, LLC 8,108 3,442 14,330 3,442
Equity losses in
unconsolidated real estate
joint ventures (26) - (32) -
Recoveries from (provision
for) loan losses 2,046 (172) 3,294 (931)
Asset impairments, net 94 (2,977) (1,225) (5,142)
----------- ----------- ---------- -----------
Income (loss) from
continuing operations
before income taxes 7,163 (2,849) 8,454 (9,381)
Provision for income taxes 6 - 6 -
----------- ----------- ----------- -----------
Net income (loss) 7,157 (2,849) 8,448 (9,381)
Less: net loss attributable
to non-controlling interest 134 - 201 -
----------- ----------- ----------- -----------
Net income (loss)
attributable to BBX Capital
Corporation $ 7,291 (2,849) 8,649 (9,381)
=========== =========== =========== ===========
Basic earnings (loss) per
share $ 0.46 (0.18) 0.54 (0.59)
=========== =========== =========== ===========
Diluted earnings (loss) per
share $ 0.43 (0.18) 0.52 (0.59)
=========== =========== =========== ===========
Basic weighted average
number of common
shares outstanding 16,005,633 15,805,009 15,995,757 15,795,492
=========== =========== =========== ===========
Diluted weighted average
number of common and
common equivalent shares
outstanding 16,790,560 15,805,009 16,746,419 15,795,492
=========== =========== =========== ===========
Bluegreen Corporation
Supplemental Financial Information - Unaudited
(Dollars in thousands)
For the Three Months Ended June 30,
---------------------------------------------
2014 2013
---------------------- ----------------------
% of % of
System- System-
wide wide
sales of sales of
VOIs, VOIs,
Amount net(5) Amount net(5)
----------- ---------- ----------- ----------
Legacy VOI sales (1) $ 46,775 34% $ 65,886 57%
VOI sales-secondary market 17,301 12% 3,755 3%
Sales of third-party VOIs-
commission basis 65,230 47% 40,867 35%
Sales of third-party VOIs-just-
in-time basis 9,670 7% 5,876 5%
---------- ---------- ----------- ----------
System-wide sales of VOIs, net 138,976 100% 116,384 100%
Less: Sales of third-party
VOIs-commission basis (65,230) -47% (40,867) -35%
---------- ---------- ----------- ----------
Gross sales of VOIs 73,746 53% 75,517 65%
Estimated uncollectible VOI
notes receivable (2) (9,675) -13% (16,926) -22%
---------- ---------- ----------- ----------
Sales of VOIs 64,071 46% 58,591 50%
Cost of VOIs sold (3) (8,277) -13% (7,808) -13%
---------- ---------- ----------- ----------
Gross profit (3) 55,794 87% 50,783 87%
Fee-based sales commission
revenue (4) 43,194 66% 26,695 65%
Other fee-based services
revenue 23,008 17% 20,416 18%
Cost of other fee-based
services (12,677) -9% (11,063) -10%
Net carrying cost of VOI
inventory (2,093) -2% (1,533) -1%
Selling and marketing expenses (65,141) -47% (53,353) -46%
General and administrative
expenses (20,484) -15% (23,886) -21%
Net interest spread 9,629 7% 9,443 8%
---------- ---------- ----------- ----------
Operating profit 31,230 22% 17,502 15%
========== ==========
Other income, net 514 181
---------- -----------
Income from continuing
operations before income taxes 31,744 17,683
Less: Provision for income
taxes 11,441 5,540
---------- -----------
Income from continuing
operations 20,303 12,143
Gain (loss) from discontinued
operations 103 (78)
---------- -----------
Net income 20,406 12,065
Less: Net income attributable
to noncontrolling interests 2,080 3,752
---------- -----------
Net income attributable to
Bluegreen $ 18,326 $ 8,313
========== ===========
BBX Capital Equity Earnings in Woodbridge - Unaudited
(in thousands)
For the Three Months
Ended June 30,
-------------------------
2014 2013
------------ ------------
Net income attributable to Bluegreen $ 18,326 8,313
Woodbridge parent only net loss (700) (830)
----------- -----------
Net income attributable to Woodbridge 17,626 7,483
BBX Capital interest in Woodbridge 46% 46%
----------- -----------
BBX Capital Equity earnings in Woodbridge $ 8,108 3,442
=========== ===========
(1) Legacy VOI sales represent sales of Bluegreen-owned VOIs acquired or
developed under Bluegreen's traditional VOI business. Legacy VOI sales
do not include Secondary Market, Commission Basis, or Just-In-Time VOI
sales.
(2) Percentages for estimated uncollectible VOI notes receivable are
calculated as a percentage of gross sales of VOIs (and not of system-
wide sales of VOIs, net).
(3) Percentages for costs of VOIs sold and gross profit are calculated as a
percentage of sales of VOIs (and not of system-wide sales of VOIs,
net).
(4) Percentage for Fee-based sales commission revenue is calculated based
on sales of third-party VOIs-commission basis (and not of system-wide
sales of VOIs, net).
(5) Unless otherwise indicated above.
Bluegreen Corporation
Supplemental Financial Information - Unaudited
(Dollars in thousands)
For the Six Months
Ended June 30, 2014
------------------------
% of
System-wide
sales of
VOIs,
Amount net(5)
------------ -----------
Legacy VOI sales (1) $ 83,638 34%
VOI sales-secondary market 36,968 15%
Sales of third-party VOIs--commission basis 107,322 43%
Sales of third-party VOIs--just-in-time basis 20,913 8%
----------- -----------
System-wide sales of VOIs, net 248,841 100%
Less: Sales of third-party VOIs--commission basis (107,322) -43%
----------- -----------
Gross sales of VOIs 141,519 57%
Estimated uncollectible VOI notes receivable (2) (17,204) -12%
----------- -----------
Sales of VOIs 124,315 50%
Cost of VOIs sold (3) (15,325) -12%
----------- -----------
Gross profit (3) 108,990 88%
Fee-based sales commission revenue (4) 70,309 66%
Other fee-based services revenue 44,933 18%
Cost of other fee-based services (23,911) -10%
Net carrying cost of VOI inventory (4,411) -2%
Selling and marketing expenses (117,699) -47%
General and administrative expenses (40,402) -16%
Net interest spread 19,215 8%
----------- -----------
Operating profit 57,024 23%
===========
Other income, net 1,027
-----------
Income from continuing operations before income
taxes 58,051
Less: Provision for income taxes 20,586
-----------
Income from continuing operations 37,465
Gain (loss) from discontinued operations 57
-----------
Net income 37,522
Less: Net income attributable to noncontrolling
interests 5,038
-----------
Net income attributable to Bluegreen $ 32,484
===========
BBX Capital Equity Earnings in Woodbridge - Unaudited
For the Six Months Ended June 30, 2014
(in thousands)
Net income attributable to Bluegreen $ 32,484
Woodbridge parent only net loss (1,332)
------------------
Net income attributable to Woodbridge 31,152
BBX Capital interest in Woodbridge 46%
------------------
BBX Capital Equity earnings in Woodbridge $ 14,330
==================
(1) Legacy VOI sales represent sales of Bluegreen-owned VOIs acquired or
developed under Bluegreen's traditional VOI business. Legacy VOI sales
do not include Secondary Market, Commission Basis, or Just-In-Time VOI
sales.
(2) Percentages for estimated uncollectible VOI notes receivable are
calculated as a percentage of gross sales of VOIs (and not of system-
wide sales of VOIs, net).
(3) Percentages for costs of VOIs sold and gross profit are calculated as a
percentage of sales of VOIs (and not of system-wide sales of VOIs,
net).
(4) Percentage for Fee-based sales commission revenue is calculated based
on sales of third-party VOIs-commission basis (and not of system-wide
sales of VOIs, net).
(5) Unless otherwise indicated above.
The following tables present Bluegreen's earnings before interest, taxes,
depreciation and amortization ("EBITDA"), as more fully described below, for the
three months ended June 30, 2014 and 2013, as well as a reconciliation of EBITDA
to Income from continuing operations (in thousands):
For the Three Months Ended
-------------------------------
June 30, 2014 June 30, 2013
--------------- --------------
Income from continuing operations -
Woodbridge $ 19,603 11,313
Loss from Woodbridge parent only (700) (830)
-------------- --------------
Income from continuing operations, Bluegreen 20,303 12,143
Add/(Less):
Interest Income (other than interest
earned on VOI notes receivable) (223) (92)
Interest Expense 10,716 10,991
Interest Expense on Receivable-Backed Debt (6,596) (6,751)
Provision for Income and Franchise Taxes 11,474 5,576
Depreciation and Amortization 1,902 1,659
-------------- --------------
EBITDA $ 37,576 23,526
============== ==============
The following tables present Bluegreen's earnings before interest, taxes,
depreciation and amortization ("EBITDA") as more fully described below, for the
six months ended June 30, 2014, as well as a reconciliation of EBITDA to Income
from continuing operations (in thousands):
Income from continuing operations - Woodbridge $ 36,133
Loss from Woodbridge parent only (1,332)
--------------
Income from continuing operations, Bluegreen 37,465
Add/(Less):
Interest Income (other than interest earned on VOI notes
receivable) (513)
Interest Expense 21,765
Interest Expense on Receivable-Backed Debt (12,720)
Provision for Income and Franchise Taxes 20,663
Depreciation and Amortization 3,607
--------------
EBITDA $ 70,267
==============
EBITDA is defined as earnings, or income from continuing operations, before
taking into account interest income (other than interest earned on VOI notes
receivable), interest expense (other than interest expense incurred on
financings related to Bluegreen's receivable-backed notes payable), provision
for income taxes and franchise taxes, and depreciation and amortization. For
purposes of the EBITDA calculation Bluegreen does not adjust for interest income
earned on Bluegreen's VOI notes receivable or the interest expense incurred on
debt that is secured by such notes receivable because Bluegreen considers both
to be part of the operations of its business.
Bluegreen considers its EBITDA to be an indicator of its operating performance,
and Bluegreen uses it to measure Bluegreen's ability to service its debt, fund
its capital expenditures and expand its business. Bluegreen also uses it, as do
lenders, investors and others, because it excludes certain items that can vary
widely across different industries or among companies within the same industry.
For example, interest expense can be dependent on a company's capital structure,
debt levels and credit ratings. Accordingly, the impact of interest expense on
earnings can vary significantly among companies. The tax positions of companies
can also vary because of their differing abilities to take advantage of tax
benefits and because of the tax policies of the jurisdictions in which they
operate. As a result, effective tax rates and provision for income taxes can
vary considerably among companies. EBITDA also excludes depreciation and
amortization because companies utilize productive assets of different ages and
use different methods of both acquiring and depreciating productive assets.
These differences can result in considerable variability in the relative costs
of productive assets and the depreciation and amortization expense among
companies.
Woodbridge Holdings, LLC
Consolidating Statement of Financial Condition - Unaudited
(In thousands)
------------------------------ -----------------------------
As of June 30, 2014 As of December 31, 2013
------------------------------ -----------------------------
Wood- Consoli- Wood- Consoli-
bridge dated bridge dated
Parent Wood- Parent Wood-
Bluegreen only bridge Bluegreen only bridge
---------- --------- --------- --------- --------- ---------
Assets
Cash and cash
equivalents $ 147,595 639 148,234 158,096 723 158,819
Restricted cash
($29,052 and
$36,263 in
VIEs at June
30, 2014 and
December 31,
2013,
respectively) 65,978 - 65,978 65,285 - 65,285
Notes
receivable,
net ($296,830
and $342,078
in VIEs at
June 30, 2014
and December
31, 2013,
respectively) 436,330 - 436,330 455,569 11,750 467,319
Inventory 203,891 - 203,891 204,256 - 204,256
Property and
equipment, net 70,933 - 70,933 63,252 - 63,252
Intangible
assets 64,027 - 64,027 64,142 - 64,142
Other assets 71,435 14,462 85,897 60,486 2,756 63,242
--------- --------- --------- --------- --------- ---------
Total assets $1,060,189 15,101 1,075,290 1,071,086 15,229 1,086,315
========= ========= ========= ========= ========= =========
Liabilities and
Equity
Accounts
payable,
accrued
liabilities
and other 89,155 628 89,783 116,304 652 116,956
Deferred income 26,575 - 26,575 - - -
Deferred tax
liability, net 97,347 - 97,347 76,726 - 76,726
Receivable-
backed notes
payable -
recourse ($0
and $5,899 in
VIE at June
30, 2014 and
December 31,
2013,
respectively) 85,982 - 85,982 74,802 - 74,802
Receivable-
backed notes
payable -
nonrecourse 329,569 - 329,569 368,759 - 368,759
Notes and
mortgage notes
payable 85,692 - 85,692 93,939 - 93,939
Junior
subordinated
debentures 63,672 85,052 148,724 62,379 85,052 147,431
--------- --------- --------- --------- --------- ---------
Total
liabilities 777,992 85,680 863,672 792,909 85,704 878,613
--------- --------- --------- --------- --------- ---------
Stockholders'
equity
Total Bluegreen
Corporation
shareholders'
equity 239,438 (70,579) 168,859 240,456 (70,475) 169,981
Noncontrolling
interest 42,759 - 42,759 37,721 - 37,721
--------- --------- --------- --------- --------- ---------
Total equity 282,197 (70,579) 211,618 278,177 (70,475) 207,702
--------- --------- --------- --------- --------- ---------
Total
liabilities
and equity $1,060,189 15,101 1,075,290 1,071,086 15,229 1,086,315
========= ========= ========= ========= ========= =========
FOR FURTHER INFORMATION PLEASE CONTACT:
BBX Capital Contact Info:
Media contact:
Laura Burns
Boardroom Communications
(954) 370-8999
Email: lburns@boardroompr.com
Investor Relations:
Leo Hinkley
Managing Director, Investor Relations Officer
954-940-5300
Email: InvestorRelations@BBXCapital.com
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