St. Joe Reports Quarterly Loss – Analyst Blog

The St. Joe Company (JOE), a publicly held operationally diverse real estate company, reported a net loss of $59.3 million or 65 cents per share in the fourth quarter of 2009 compared to a net loss of $27.9 million or 31 cents per share in the year-earlier quarter.

 

For full year 2009, St. Joe reported net loss of $130.0 million or $1.42 per share compared to a net loss of $35.9 million or 40 cents per share in the previous year. Both quarterly and fiscal results included pre-tax charges of $84.0 million and $163.1 million or 56 cents and $1.07 per share after tax, respectively, primarily due to non-cash impairment charges related to asset sale.

 

During 2009, St. Joe sold 29 acres of commercial land for $6.6 million and generated $57.5 million of revenue from residential real estate sales. In addition, the company sold 6,967 acres of rural land for $14.3 million in 2009 compared to $162 million in 2008. Going forward, the company will rely less on rural land sales as it has become increasingly harder to sell land at attractive prices due to the challenging macroeconomic environment.

 

At year-end 2009, St. Joe had $163.8 million of cash and $27.1 million of pledged securities. Total debt outstanding was $39.5 million, out of which $27.1 million was defeased debt. In addition, the company had $125 million available under its revolving credit facilities.

 

St. Joe is currently in a defensive mode and continues to reduce capital expenditures to conserve cash. Capital expenditures for full year 2009 were $18.4 million, compared to $34.7 million in 2008, a reduction of 47%. In addition, the company incurred cash overhead expenses of $57.6 million for full year 2009, compared to $81.7 million in the last year, a reduction of 30%.

 

St. Joe is continuing construction work of the new international airport near Panama City Beach, slated to open in May 2010. Once completed, the airport will become a major growth driver for the region, creating jobs and revenue generating opportunities for other companies.

 

St. Joe is currently developing approximately 1,000 acres adjacent to the new airport for industries, offices, retailers, and hotels. During the fourth quarter of 2009, St. Joe forged a strategic alliance with Southwest Airlines (LUV) to provide a low-cost air service from the airport, which is further expected to have a positive economic impact on the region in the long run.