Cadiz Reports Third Quarter Results; Announces Sale of American SunMelon.SANTA MONICA Santa Monica (săn`tə mŏn`ĭkə), city (1990 pop. 86,905), Los Angeles co., S Calif., on Santa Monica Bay; inc. 1886. Tourism and retailing are important, and the city has motion-picture, biotechnology, and software industries. , Calif.--(BUSINESS WIRE)--Nov. 5, 1998--Cadiz Inc., (Nasdaq: CLCI CLCI Dichlorodimethyl Ether ) today reported results for the third quarter ended September 30, 1998. Revenues for the quarter were $45.6 million, operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. was $0.2 million and net loss was $4.9 million, or ($.15) per share. In the third quarter of 1997, revenues were $53.0 million, operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. was $7.6 million and net income was $3.6 million, or $.11 per share. The difference in 1998 and 1997 third quarter results is primarily attributable to a delay in the harvest season, which was caused by wet and cool spring weather conditions. Therefore, a significant portion of the Company's revenues and operating profit, typically recognized in the third quarter, will be recognized in the fourth quarter of 1998. The majority of the Company's annual revenues are generated by the harvest and sale of crops produced by its wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , Sun World International, Inc., ("Sun World"). Those revenues are primarily recognized between June and October, while fixed overhead costs overhead costs see fixed costs. are incurred throughout the year. Therefore, the Company's three- and nine-month results are not indicative of the results of operations for a full fiscal year. For the nine months ended September 30, 1998, revenues were $73.7 million, operating loss was $2.0 million and net loss was $15.1 million, or ($.46) per share. For the nine months ended September 30, 1997, revenues were $83.5 million, operating profit was $4.4 million and net loss was $7.3 million, or ($.30) per share. Earnings before income taxes plus interest expenses, depreciation and amortization (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) contributed from Sun World were $7.3 million for the nine months ended September 30, 1998, compared to $12.7 million for the nine months ended September 30, 1997. Additionally, the Company announced that American SunMelon, a 50/50 partnership between Sun World Brands, a wholly-owned subsidiary of Sun World, and American Seedless Seed´less a. 1. Without seed or seeds. Adj. 1. seedless - lacking seeds; "seedless grapefruit" seedy - full of seeds; "as seedy as a fig" seedless adj → Corporation, sold the majority of its assets to Novartis Seeds, Inc., for $35.0 million in cash on October 27, 1998. In conjunction with this sale, Sun World received an initial distribution of $15.2 million from the partnership. American SunMelon primarily focuses on the production and distribution of watermelon watermelon, plant (Citrullus vulgaris) of the family Curcurbitaceae (gourd family) native to Africa and introduced to America by Africans transported as slaves. Watermelons are now extensively cultivated in the United States and are popular also in S Russia. seeds throughout North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , Europe and Australia. The Company expects that the distribution generated from the sale of American SunMelon assets, when combined with fourth quarter results, will positively impact overall results for 1998 when compared to 1997. As previously reported, the Company and the Metropolitan Water District of Southern California The Metropolitan Water District of Southern California is the largest bulk water supplier for municipal use in the world. The name is usually shortened to the "Metropolitan Water District" or simply "MWD". ("Metropolitan") have initiated the environmental review process for a groundwater storage and dry-year supply program ("the Program") at the Company's Cadiz, California Cadiz is a small unincorporated community in the Mojave Desert in California. It is located just south of the Marble Mountains near National Trails Highway in San Bernardino County. property. In preparing for the Environmental Impact Report/Environmental Impact Statement, Metropolitan and the Company have commenced with a variety of hydrological hy·drol·o·gy n. The scientific study of the properties, distribution, and effects of water on the earth's surface, in the soil and underlying rocks, and in the atmosphere. and engineering tasks in order to determine the optimum design of program facilities, and are pleased with the progress to date. Founded in 1983, Cadiz Inc., is a publicly held agricultural and water development firm. With its subsidiary, Sun World International, Inc., Cadiz is one of the largest vertically integrated agricultural companies in California. The Company owns significant landholdings with substantial water resources throughout California. This release contains forward-looking statements that are subject to significant risks and uncertainties, including statements related to the future operating and financial performance of the Company. Although the Company believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Factors that could cause actual results or events to differ materially from those reflected in the Company's forward-looking statements include price and yield fluctuations in the agricultural operations, seasonality, timing and terms of various approvals required to complete the Program, and other factors and considerations detailed in the Company's Securities and Exchange Commission filings.
Cadiz Inc.
Financial Summary
Three Months Nine Months
Ended September 30 Ended September 30
1998 1997 1998 1997
($ in thousands except per share data)
Revenues 45,596 52,949 73,699 83,492
Operating profit
(loss) (192) 7,555 (1,989) 4,376
Interest expense,
net 4,702 3,937 13,159 11,723
Net income
(loss) (4,894) 3,618 (15,148) (7,347)
Less: Preferred stock
dividends -- (9) -- (1,213)
Net income (loss) applicable to common
stock (4,894) 3,609 (15,148) (8,560)
Net income (loss) per common
share (.15) .11 (.46) (.30)
Weighted average shares
outstanding 33,280 32,400 33,069 28,400
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