The St. Joe Company (NYSE: JOE) (the “Company”) today announced
Net Income for the third quarter of 2017 of $5.9 million, or $0.08
per share, compared with Net Income of $2.7 million, or $0.04 per
share, for the third quarter of 2016. For the nine months ended
September 30, 2017, the Company reported Net Income of $21.0
million, or $0.29 per share, compared to Net Income of $13.2
million, or $0.18 per share, for the same period last year.
Third Quarter highlights include:
- Total revenue for the quarter was $33.6
million as compared to $27.2 million in the third quarter of 2016
due to increases in real estate revenue, leasing revenue and timber
revenue, partially offset by a decrease in resorts and leisure
revenue.
- Real estate revenue increased to $10.7
million in the third quarter of 2017 as compared to $4.2 million in
the third quarter of 2016. Real estate revenue in the third quarter
of 2017 included $9.4 million in residential real estate revenue,
$0.4 million in commercial real estate revenue and $0.9 million in
rural land revenue. The third quarter of 2016 consisted of $3.1
million in residential real estate revenue, $0.6 in commercial real
estate revenue and $0.5 million in rural land revenue. Income
before income taxes for the three months ended September 30, 2017
for the Company’s residential real estate segment increased by $1.6
million as compared to the three months ended September 30, 2016.
The Company continues to invest in the development of additional
residential lots in the WaterSound Origins and Breakfast Point
communities, which management believes have the potential for
long-term, scalable and repeatable revenue.
- Resorts and leisure revenue decreased
in the third quarter of 2017 to $18.2 million as compared to $19.0
million in the third quarter of 2016. The decrease during the third
quarter of 2017 as compared to the same period in 2016 was
primarily related to lower vacation rental inventory, partially
offset by revenue increases from St. Joe Club & Resorts, the
Company’s private membership club. Although resort and leisure
revenue decreased 4.2% for the quarter, income before income taxes
increased by $0.5 million compared to the third quarter of 2016 due
to improved operating efficiency and cost management.
- Leasing revenue increased by
approximately $0.1 million in the third quarter of 2017 as compared
to the third quarter of 2016. The increase represents an eleventh
consecutive quarter of increased revenue in the leasing segment as
compared to the same quarter in the previous year. As of September
30, 2017, the Company’s leasing portfolio consisted of
approximately 675,000 square feet of rentable space, which was 85%
leased, an increase in rentable space of approximately 73,000
square feet since December 2016.
- As of September 30, 2017, the Company
had cash, cash equivalents and investments of $312.0 million as
compared to $416.8 million as of December 31, 2016 after spending a
total of $34.5 million on operating and development properties and
$136.0 million on share repurchases. During the nine months ended
September 30, 2017, the Company repurchased a total of 7,811,937
shares of its common stock. As of September 30, 2017, the Company
had approximately 66.5 million shares of its common stock
outstanding.
- Other operating and corporate expenses
declined by $0.2 million in the third quarter of 2017 as compared
to the same time last year. The Company continues its focus on a
cost discipline to support bottom line performance.
Jorge Gonzalez, the Company’s President and Chief Executive
Officer, said, “We believe our third quarter and year-to-date
results reflect that our business strategy to increase both
recurring revenue and investments in our real estate produced
improved results.” Mr. Gonzalez added, “We are pleased with our
current progress as we continue to build on the fundamentals and
strengths of the Company’s assets and its people.”
FINANCIAL DATA Consolidated Results
($ in millions except share and per
share amounts)
Quarter
Ended
Nine Months
Ended
September
30,
September
30,
2017
2016
2017
2016
Revenue
Real estate revenue $10.7 $4.2 $19.4
$18.0 Resorts and leisure revenue 18.2 19.0
45.6 47.6 Leasing revenue 2.8 2.7 7.9
7.4 Timber revenue
1.9
1.3 4.3 4.0
Total revenue
33.6 27.2
77.2 77.0 Expenses
Cost of real
estate revenue 6.4 2.0 10.4 6.7 Cost of
resorts and leisure revenue 14.5 15.4 38.2
40.4 Cost of leasing revenue 0.8 0.7
2.3 2.2 Cost of timber revenue 0.2 0.2
0.6 0.6 Other operating and corporate expenses 5.0
5.2 15.3 17.7 Depreciation, depletion and
amortization
2.3 2.1
6.2 6.5 Total expenses
29.2 25.6 73.0
74.1 Operating income
4.4
1.6 4.2
2.9 Investment income, net 6.4 4.7
31.1 10.4 Interest expense (3.0) (3.1)
(9.1) (9.3) Other income, net
0.9
0.4 5.5
14.0 Income before income taxes 8.7 3.6
31.7 18.0 Income tax expense
(2.6) (0.9) (10.8)
(5.2) Net income 6.1 2.7
20.9 12.8 Net (income) loss attributable to non-controlling
interest
(0.2) --
0.1 0.4 Net income attributable to
the Company
$5.9 $2.7
$21.0 $13.2 Net income per
share attributable to the Company
$0.08
$0.04 $0.29
$0.18 Weighted average shares outstanding
70,202,807 74,342,826 72,037,772 74,496,058
Summary Balance Sheet ($ in millions)
September 30,
2017
December 31,
2016
Assets Investment in real
estate, net $337.5 $314.6 Cash and cash equivalents
166.8 241.1 Investments 145.2 175.7
Restricted investments 4.5 5.6 Income tax receivable
-- 27.1 Claim settlement receivable 8.0
7.8 Other assets 40.5 38.4 Property and equipment,
net 9.3 9.0 Investments held by special purpose
entities
207.9 208.6 Total
assets
$919.7 $1,027.9
Liabilities and Equity
Debt $55.7 $55.0 Other
liabilities 49.9 41.0 Deferred tax liabilities
70.8 68.8 Senior Notes held by special purpose entity
176.5 176.3 Total liabilities
352.9 341.1 Total equity
566.8
686.8 Total liabilities and equity
$919.7 $1,027.9 Debt
Schedule ($ in millions)
September 30,
2017
December 31,
2016
Pier Park North joint venture refinanced loan $47.0
$47.5 Community Development District debt 7.1 7.5
Construction loan
1.6 --
Total debt
$55.7 $55.0
Other Operating and Corporate Expenses ($ in
millions) Quarter Ended Nine Months
Ended
September
30,
September
30,
2017
2016
2017
2016
Employee costs $1.7 $1.8 $5.3 $5.3
401(k) contribution -- -- 1.2 1.4
Non-cash stock compensation costs -- -- --
0.1 Property taxes and insurance 1.3 1.4
4.1 4.2 Professional fees 0.8 1.2
2.2 3.8 Marketing and owner association costs
0.4 0.3 1.0 1.0 Occupancy, repairs and
maintenance 0.2 0.2 0.4 0.5 Other
0.6 0.3
1.1 1.4 Total other operating and
corporate expense
$5.0 $5.2
$15.3 $17.7
Additional Information and Where to
Find It
Additional information with respect to the Company’s results for
the third quarter of 2017 will be available in a Form 10-Q that
will be filed with the Securities and Exchange Commission, which
can be found at the SEC’s website www.sec.gov.
Important Notice Regarding
Forward-Looking Statements
Certain statements contained in this press release, as well as
other information provided from time to time by the Company or its
employees, may contain forward-looking statements that involve
risks and uncertainties that could cause actual results to differ
materially from those in the forward-looking statements. You can
identify forward-looking statements by the fact that they do not
relate strictly to historical or current facts. These statements
may include words such as “guidance,” “anticipate,” “estimate,”
“expect,” “forecast,” “project,” “plan,” “intend,” “believe,”
“confident,” “may,” “should,” “can have,” “likely,” “future” and
other words and terms of similar meaning in connection with any
discussion of the timing or nature of future operating or financial
performance or other events. Examples of forward-looking statements
in this press release include statements regarding the
implementation of our business strategy; our actions to build on
the fundamentals and strengths of the Company’s assets and its
people; our continued cost discipline; our focus on higher yielding
vacation rental properties; and our continued investment in the
development of additional residential lots in the WaterSound
Origins and Breakfast Point communities, which management believes
have the potential for long-term, scalable and repeatable revenue.
Any such forward-looking statements are not guarantees of
performance or results, and involve risks, uncertainties (some of
which are beyond the Company’s control) and assumptions.
The Company wishes to caution readers that, although we believe
any forward-looking statements are based on reasonable assumptions,
certain important factors may have affected and could in the future
affect the Company’s actual financial results and could cause the
Company’s actual financial results for subsequent periods to differ
materially from those expressed in any forward-looking statement
made by or on behalf of the Company, including (1) any changes in
our strategic objectives or our ability to successfully implement
such strategic objectives; (2) any potential negative impact of our
longer-term property development strategy, including losses and
negative cash flows for an extended period of time if we continue
with the self-development of recently granted entitlements; (3)
significant decreases in the market value of our investments in
securities or any other investments; (4) our ability to capitalize
on strategic opportunities presented by a growing retirement
demographic; (5) our ability to accurately predict market demand
for the range of potential residential and commercial uses of our
real estate, including our Bay-Walton Sector holdings; (6)
volatility in the consistency and pace of our residential real
estate sales; (7) any downturns in real estate markets in Florida
or across the nation; (8) our dependence on the real estate
industry and the cyclical nature of our real estate operations; (9)
our ability to successfully and timely obtain land use entitlements
and construction financing, maintain compliance with state law
requirements and address issues that arise in connection with the
use and development of our land, including the permits required for
mixed-use and active adult communities; (10) changes in laws,
regulations or the regulatory environment affecting the development
of real estate; (11) our ability to effectively deploy and invest
our assets, including our available-for-sale securities; (12) our
ability to effectively manage our real estate assets, as well as
the ability of our joint venture partner to effectively manage the
day-to-day activities of the Pier Park North joint venture; and
(13) increases in operating costs, including costs related to real
estate taxes, owner association fees, construction materials, labor
and insurance and our ability to manage our cost structure; as well
as, the cautionary statements and risk factor disclosures contained
in the Company’s Securities and Exchange Commission filings
including the Company’s Annual Report on Form 10-K for the year
ended December 31, 2016, as updated by subsequent Quarterly Reports
on Form 10-Q and other current report filings, all of which can be
found at the SEC’s website www.sec.gov. The discussion of these
risks is specifically incorporated by reference into this press
release.
Any forward-looking statement made by us in this press release
speaks only as of the date on which it is made. We undertake no
obligation to update any forward-looking statement, whether as a
result of new information, future developments or otherwise, except
as may be required by law.
About The St. Joe
Company
The St. Joe Company together with its consolidated subsidiaries
is a real estate development, asset management and operating
company with real estate assets and operations currently
concentrated primarily between Tallahassee and Destin, Florida.
More information about the Company can be found on its website at
www.joe.com.
© 2017, The St. Joe Company, “St. Joe®”, “JOE®”, the “Taking
Flight” Design®, “St. Joe (and Taking Flight Design)®” are
registered service marks of The St. Joe Company.
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version on businesswire.com: http://www.businesswire.com/news/home/20171102006604/en/
The St. Joe CompanyInvestor Relations Contact:Marek Bakun,
1-866-417-7132Chief Financial OfficerMarek.Bakun@Joe.Com
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