Tejon Ranch Co. (NYSE:TRC) today released the results of operations for the three months ended March 31, 2014, with the Company showing net income attributable to common stockholders of $1,113,000, or $0.05 per common share, an increase of $498,000 when compared to net income attributable to common stockholders of $615,000, or $0.03 per common share, for the same period in 2013. Revenue from operations for the three months ended March 31, 2014 was $7,145,000, compared to $9,760,000 of revenue for the same period during 2013. All per share references in this release are presented on a fully diluted basis.
Results of Operations for the Quarter Ended March 31, 2014:
The improvement in net income attributable to common stockholders is primarily due to $3,002,000 in net income received from sales of water during the quarter, and to reduced expenses within our farming and corporate general and administrative operations. The overall reduction in revenue from operations during the first quarter is the result of lower farming and mineral resources revenue.
The decline in farming revenue of $2,355,000 is due to a 67% decrease in the number of almonds sold during the first quarter of 2014, stemming from a lower carry forward of 2013 crop inventory. This decline in the volume of almond sales was partially offset, however, by a 13% increase in almond prices. Farming expenses also declined during the quarter due to lower cost of sales for almonds. Compared to the same time period in 2013, mineral resource revenues declined $602,000 during the first quarter of 2014. The decline is due to a decrease of $514,000 in oil royalty revenues and $256,000 in oil leasehold payments. The decrease in oil royalties is tied to a decline in production of approximately 21% during the quarter, resulting from the timing of completion of the expansion of new lessee production facilities. Leasehold payments declined due to Sojitz Energy beginning a drill program in late 2013, which eliminated their obligation for continued leasehold payments. The Company did see positive improvement from our rock and aggregate operations as well as the National Cement lease, with an increase in royalties of $168,000 driven by improved construction activity in our region. Commercial/industrial revenue also increased $220,000, due primarily to an increase in development fees related to the construction of the Outlets at Tejon.