(Source: Business Wire)
Tejon Ranch Co. (NYSE:TRC) today announced a net loss from operations for the second quarter of 2009, ended June 30, 2009, and a net loss from operations for the first six months of 2009. For the second quarter of 2009, the Company had a net loss of $1,487,000, or $0.09 per common share, compared to net income of $1,320,000, or $0.07 per common share during the second quarter of 2008. Revenue from operations for the second quarter of 2009 was $4,282,000 compared to $10,023,000 of revenue during the same period in 2008. All per share references in this release are presented on a fully-diluted basis.
For the first six months of 2009, the Company had a net loss of $2,826,000, or $0.17 per common share, compared to net income of $251,000, or $0.01 per common share for the first six months of 2008. Revenue from operations for the six months ending June 30, 2009 was $8,173,000 compared to $15,267,000 of revenue during the same period of 2008.
Results of Operations for the First Six Months of 2009:
The decline in revenue during the first six months of 2009 was due to decreased farming and commercial/industrial revenue. Commercial/industrial revenue decreased $6,114,000, primarily due to the absence of land sales during the first six months of 2009 compared to $4,289,000 of land sales during the same period of 2008. Oil and mineral royalties also declined $1,413,000 during the period due to an overall decline in per barrel prices for oil. The decline in oil prices more than offset higher oil production volumes experienced in the first six months of this year compared to the first half of 2008. Farming revenue during the first six months of 2009 was $980,000 lower than the same period of 2008 due to a decline in almond revenue resulting from fewer prior year crop almonds being available for sale during the period and to the seasonality of our farming revenues.
The decline in earnings for the first six months of 2009 is attributable to the decrease in revenues described above. However, that decline in revenue was partially offset by lower operating expenses in our commercial/industrial and farming segments, and in our corporate operations. Expenses within our commercial/industrial segment decreased $1,480,000 during the first six months of 2009, due primarily to a reduction in cost of sales of $1,003,000 related to land sale transactions in 2008 and to lower professional service fees. Farming costs declined $468,000 during the first six months of 2009, compared to the same period in 2008, due to lower almond cost of sales. Corporate general and administrative costs fell $1,269,000 during the period due to a $1,078,000 decrease in compensation costs related to incentive plans and lower professional service fees.
Results of Operations for the Second Quarter of 2009:
Revenues from operations during the second quarter of 2009, as compared to the same period of 2008, fell $5,741,000. The decline is primarily attributable to a $4,289,000 reduction in land sale revenue, a decrease in oil and mineral royalties of $949,000 due to reduced oil prices, and lower farming revenues resulting from a decline in almond sales.
Earnings fell during the second quarter of 2009, as compared to the same period of 2008, due primarily to the decline in revenues just described. This reduction in revenue, however, was partially offset by lower commercial/industrial segment costs of $1,327,000 and lower corporate general and administrative costs of $883,000. Commercial/industrial costs declined when compared to the second quarter of 2008 due to the absence of cost of sales on land and to lower professional service fees. Corporate costs are lower primarily due to decreases in compensation costs and professional service fees.
2009 Outlook:
During the remainder of 2009 the Company anticipates continued investment in infrastructure at the Tejon Industrial Complex and investments in our joint ventures. Our financial position will allow us to continue to pursue these investments as well as our long-term strategies of land entitlement, development, and conservation.
