Alico, Inc. Enters Material Agreement, Reports Exit Costs
Ticker: ALCO · Form: 8-K · Filed: Jan 6, 2025 · CIK: 3545
Sentiment: neutral
Topics: material-agreement, exit-costs, operations
Related Tickers: ALCO
TL;DR
Alico signed a big deal & is cutting some costs. Details TBD.
AI Summary
On January 3, 2025, Alico, Inc. entered into a material definitive agreement related to its citrus operations. The company also reported costs associated with exit or disposal activities, though specific financial details of these events were not disclosed in this filing.
Why It Matters
This filing indicates significant operational changes or strategic moves by Alico, Inc., which could impact its future financial performance and business structure.
Risk Assessment
Risk Level: medium — The filing mentions a material definitive agreement and exit costs, suggesting potential restructuring or significant operational shifts that carry inherent business risks.
Key Players & Entities
- Alico, Inc. (company) — Registrant
- January 3, 2025 (date) — Date of earliest event reported
- Florida (location) — State of incorporation
FAQ
What is the nature of the material definitive agreement Alico, Inc. entered into?
The filing states that Alico, Inc. entered into a material definitive agreement, but the specific details of this agreement are not provided in this 8-K filing.
What are the specific costs associated with exit or disposal activities reported by Alico, Inc.?
The filing mentions costs associated with exit or disposal activities, but the exact financial amounts are not detailed in this document.
When was the earliest event reported in this 8-K filing?
The earliest event reported in this 8-K filing occurred on January 3, 2025.
What is Alico, Inc.'s Standard Industrial Classification (SIC) code?
Alico, Inc.'s SIC code is 0100, which corresponds to AGRICULTURE PRODUCTION - CROPS.
Where is Alico, Inc. headquartered?
Alico, Inc.'s business address is located at 10070 Daniels Interstate Court Ste. 100, Ft. Myers, FL 33913.
Filing Stats: 1,198 words · 5 min read · ~4 pages · Grade level 14.1 · Accepted 2025-01-06 07:08:01
Key Financial Figures
- $1.5 — it will incur charges of approximately $1.5 to $2.0 million in connection with the
- $2.0 million — incur charges of approximately $1.5 to $2.0 million in connection with the Workforce Reduct
Filing Documents
- alco-20250103.htm (8-K) — 30KB
- 0000003545-25-000014.txt ( ) — 156KB
- alco-20250103.xsd (EX-101.SCH) — 2KB
- alco-20250103_lab.xml (EX-101.LAB) — 22KB
- alco-20250103_pre.xml (EX-101.PRE) — 13KB
- alco-20250103_htm.xml (XML) — 3KB
01. Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement. On January 3, 2025, Alico, Inc. (the "Company") delivered a notice (the "Notice") to Tropicana Manufacturing Company, Inc. ("Tropicana") in accordance with the Orange Purchase Agreement No. R641, dated April 11, 2024 (the "Agreement"), between the Company and Tropicana, under which the Company agrees to sell, and Tropicana agrees to purchase, oranges from the groves identified therein. The Agreement grants the Company the right to remove certain acreages from the contract if, in the Company's best judgment, such acreages are no longer economically viable, provided that Tropicana consents, which consent shall not be unreasonably withheld or delayed. As detailed in the Notice, the Company's Board of Directors (the "Board") has determined that certain of the acreage specified in the Agreement is no longer economically viable for orange cultivation. As a result, the Company has provided the Notice to Tropicana seeking Tropicana's consent for the removal of such acreage, effective at the end of the 2024/2025 crop year. Consequently, if Tropicana consents, its purchase obligations under the Agreement with respect to such acreage are expected to conclude upon the completion of the 2024/2025 crop year.
05. Costs Associated with Exit or Disposal Activities
Item 2.05. Costs Associated with Exit or Disposal Activities. On January 3, 2025, the Board approved a reduction in the Company's current workforce by up to 172 employees, effective on or about January 6, 2025 with respect to up to 135 employees, and effective on or about April 1, 2025 with respect to up to 37 employees (the "Workforce Reduction"). The Board's decision is part of cost-reduction initiatives aimed at providing investors with a greater return on capital that includes the benefits and stability of a conventional agriculture investment, with the optionality that comes with active land management. This decision is associated with a strategic transformation in the Company's business focus, to wind down its Alico Citrus division, which holds the Company's citrus production operations, to focus on its long-term diversified land usage and real estate development strategy, due to increasing financial challenges from citrus greening disease and environmental factors for many seasons. The Company currently estimates that it will incur charges of approximately $1.5 to $2.0 million in connection with the Workforce Reduction, primarily consisting of severance payments, employee benefits and related costs. The Company expects that the majority of these charges will be incurred in the second and third quarters of 2025. The Company may incur additional expenses not currently contemplated due to events associated with the Workforce Reduction. The charges that the Company expects to incur in connection with the Workforce Reduction are estimates and subject to a number of assumptions, and actual results may differ materially.
Forward-Looking Statements
Forward-Looking Statements This Current Report on Form 8-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, but are not limited to, statements regarding changes to the Agreement with Tropicana and receipt of Tropicana's consent thereunder, the Company's strategic transformation, the Company's Workforce Reduction, and any other statements relating to our future activities or other future events or conditions. These statements are based on our current expectations, estimates and projections about our business based, in part, on assumptions made by our management and can be identified by terms such as "if," "will," "should," "expects," "plans," "hopes," "anticipates," "could," "intends," "targets," "projects," "contemplates," "believes," "estimates," "forecasts," "predicts," "potential" or "continue" or the negative of these terms or other similar expressions. These forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including, but not limited to: our ability to successfully develop and execute our strategic growth initiatives and whether they adequately address the challenges or opportunities we face; water use regulations restricting our access to water; harm to our reputation; tax risks associated with a Section 1031 Exchange; risks associated with the undertaking of one or more significant corporate transactions; the result of any significant corporate transactions; any change or the classification or valuation methods employed by county property appraisers related to our real estate taxes; loss of key employees; material weaknesses and other contr
SIGNATURES
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. Date: January 6, 2025 ALICO, INC. By: /s/ Bradley Heine Bradley Heine Chief Financial Officer