XML 26 R12.htm IDEA: XBRL DOCUMENT
v3.20.2

Long-Term Debt and Lines of Credit | 9 Months Ended
--- | ---
Jun. 30, 2020
Debt Disclosure [Abstract] |
Long-Term Debt and Lines of Credit | Note 5. Long-Term Debt and Lines of Credit The following table summarizes long-term debt and related deferred financing costs, net of accumulated amortization at June 30, 2020 and September 30, 2019:
|  | June 30, 2020 |  |  | September 30, 2019 |
(in thousands) |  | Principal |  |  | Deferred Financing Costs, Net |  |  | Principal |  |  | Deferred Financing Costs, Net |
Long-term debt, net of current portion: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Met Fixed-Rate Term Loans |  | $ | 85,000 |  |  | $ | 647 |  |  | $ | 89,688 |  |  | $ | 724 |
Met Variable-Rate Term Loans |  |  | 41,688 |  |  | 297 |  |  |  | 43,844 |  |  |  | 334 |
Met Citree Term Loan |  |  | 4,575 |  |  | 37 |  |  |  | 4,750 |  |  |  | 40 |
Pru Loans A & B |  |  | 15,387 |  |  | 211 |  |  |  | 16,257 |  |  |  | 224 |
Pru Loan E |  |  | 4,290 |  |  | 3 |  |  |  | 4,455 |  |  |  | 9 |
Pru Loan F |  |  | — |  |  |  | — |  |  |  | 4,455 |  |  |  | 38 |
|  |  | 150,940 |  |  |  | 1,195 |  |  |  | 163,449 |  |  |  | 1,369 |
Less current portion |  |  | 5,130 |  |  |  | — |  |  |  | 5,338 |  |  |  | — |
Long-term debt |  | $ | 145,810 |  |  | $ | 1,195 |  |  | $ | 158,111 |  |  | $ | 1,369 |
The following table summarizes lines of credit and related deferred financing costs, net of accumulated amortization at June 30, 2020 and September 30, 2019:
|  | June 30, 2020 |  |  | September 30, 2019 |
(in thousands) |  | Principal |  |  | Deferred Financing Costs, Net |  |  | Principal |  |  | Deferred Financing Costs, Net |
Lines of Credit: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
RLOC |  | $ | 20,000 |  |  | $ | 145 |  |  | $ | — |  |  | $ | 8 |
WCLC |  |  | 44,380 |  |  |  | — |  |  |  | — |  |  |  | — |
Lines of Credit |  | $ | 64,380 |  |  | $ | 145 |  |  | $ | — |  |  | $ | 8 |
Future maturities of long-term debt and lines of credit as of June 30, 2020 are as follows:
(in thousands) |  |  |  |
|  | June 30, 2020 |
Due within one year |  | $ | 5,130 |
Due between one and two years |  |  | 58,985 |
Due between two and three years |  |  | 10,535 |
Due between three and four years |  |  | 10,535 |
Due between four and five years |  |  | 10,535 |
Due beyond five years |  |  | 119,600 |
Total future maturities |  | $ | 215,320 |
Interest costs expensed and capitalized were as follows:
(in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended June 30, |  |  | Nine Months Ended June 30, |
|  | 2020 |  |  | 2019 |  |  | 2020 |  |  | 2019 |
Interest expense |  | $ | 1,603 |  |  | $ | 1,745 |  |  | $ | 4,599 |  |  | $ | 5,625 |
Interest capitalized |  |  | 320 |  |  |  | 269 |  |  |  | 892 |  |  |  | 714 |
Total |  | $ | 1,923 |  |  | $ | 2,014 |  |  | $ | 5,491 |  |  | $ | 6,339 |
Debt The Company's credit facilities consist of $125,000,000 in fixed interest rate term loans (“Met Fixed-Rate Term Loans”), $57,500,000 in variable interest rate term loans (“Met Variable-Rate Term Loans”), a $25,000,000 revolving line of credit (“RLOC”) with Metropolitan Life Insurance Company and New England Life Insurance Company (collectively “Met”), and a $70,000,000 working capital line of credit (“WCLC”) with Rabo Agrifinance, Inc. (“Rabo”). The term loans and RLOC are secured by real property. The security for the term loans and RLOC consists of approximately 38,200 gross acres of citrus groves and 5,800 gross acres of ranch land. The WCLC is collateralized by the Company’s current assets and certain other personal property owned by the Company. The term loans, collectively, are subject to quarterly principal payments of $2,281,250, and mature November 1, 2029. The Met Fixed-Rate Term Loans bear interest at 4.15% per annum, and the Met Variable-Rate Term Loans bear interest at a rate equal to 90-day LIBOR plus 165 basis points (the “LIBOR spread”). The LIBOR spread is subject to adjustment by Met beginning May 1, 2017 and is subject to further adjustment every two years thereafter until maturity. No adjustment was made at May 1, 2019. Interest on the term loans is payable quarterly. The interest rates on the Met Variable-Rate Term Loans were 2.41% per annum and 3.91% per annum as of June 30, 2020 and September 30, 2019, respectively. The Company may prepay up to $8,750,000 of the Met Fixed-Rate Term Loan principal annually without penalty, and any such prepayments may be applied to reduce subsequent mandatory principal payments. The maximum annual prepayment was made for calendar year 2015. During the first and second quarter of fiscal year 2018, the Company elected not to make its principal payment and utilized a portion of its 2015 prepayment to satisfy its principal payment requirements for such quarters. At June 30, 2020, the Company had $5,625,000 remaining available to reduce future mandatory principal payments should the Company elect to do so. The Met Variable-Rate Term Loans may be prepaid without penalty. In March 2020, as a precautionary measure, the Company drew down an aggregate of $70,000,000 on its revolving credit facilities; $20,000,000 on its RLOC and $50,000,000 on its WCLC. This decision was made to safeguard the Company’s liquidity and to increase available cash on hand in the event of a more protracted COVID-19 outbreak. The RLOC bears interest at a floating rate equal to 90-day LIBOR plus 165 basis points, payable quarterly. The LIBOR spread was adjusted by Met on May 1, 2017 and is subject to further adjustment every two years thereafter. No adjustment was made at May 1, 2019. In October 2019, the RLOC agreement was modified to extend the current maturity of November 1, 2019 to November 1, 2029. The RLOC is subject to an annual commitment fee of 25 basis points on the unused portion of the line of credit. The RLOC is available for funding general corporate needs. The variable interest rate was 2.41% and 3.91% per annum as of June 30, 2020 and September 30, 2019, respectively. There was $20,000,000 and $0 outstanding on the RLOC at June 30, 2020 and September 30, 2019, respectively. Availability under the RLOC was $5,000,000 and $25,000,000 as of June 30, 2020 and September 30, 2019, respectively. The WCLC is a revolving credit facility and is available for funding working capital and general corporate requirements. The interest rate on the WCLC is based on the one month LIBOR, plus a spread, which is adjusted quarterly, based on the Company's debt service coverage ratio for the preceding quarter and can vary from 175 to 250 basis points. The rate is currently at LIBOR plus 175 basis points. The variable interest rate was 1.92% and 3.85% per annum as of June 30, 2020 and September 30, 2019, respectively. The WCLC agreement was amended on September 20, 2018, and the primary terms of the amendment were an extension of the maturity to November 1, 2021. There were no changes to the commitment amount or interest rate. The WCLC agreement provides for Rabo to issue up to $2,000,000, reduced from $20,000,000 during fiscal year 2019, in letters of credit on the Company’s behalf. As of June 30, 2020, there was approximately $399,000 in outstanding letters of credit, which correspondingly reduced the Company's availability under the line of credit. The WCLC is subject to a quarterly commitment fee on the daily unused availability under the line computed as the commitment amount less the aggregate of the outstanding loans and outstanding letters of credit. The commitment fee is adjusted quarterly based on Alico's debt service coverage ratio for the preceding quarter and can vary from a minimum of 20 basis points to a maximum of 30 basis points. Commitment fees to date have been charged at 20 basis points. There was $44,380,000 and $0 outstanding on the WCLC at June 30, 2020 and September 30, 2019, respectively. Availability under the WCLC was approximately $25,221,000 and $69,540,000 as of June 30, 2020 and September 30, 2019, respectively. In 2014, the Company capitalized approximately $2,834,000 of debt financing costs related to the refinancing and approximately $339,000 of costs related to the retired debt. Additionally, financing costs of approximately $23,000 and $133,000 were incurred in the nine months ended June 30, 2020 and for the fiscal year ended September 30, 2019, respectively, in connection with the extension of the RLOC. All costs are included in deferred financing and being amortized to interest expense over the applicable terms of the obligations. The unamortized balance of deferred financing costs related to the financing above was approximately $1,089,000 and approximately $1,066,000 at June 30, 2020 and September 30, 2019, respectively. These credit facilities noted above are subject to various covenants including the following financial covenants: (i) minimum debt service coverage ratio of 1.10 to 1.00, (ii) tangible net worth of at least $160,000,000 increased annually by 10% of consolidated net income for the preceding years, or approximately $167,364,000 for the year ended September 30, 2019, (iii) minimum current ratio of 1.50 to 1.00, (iv) debt to total assets ratio not greater than .625 to 1.00, and, (v) solely in the case of the WCLC, a limit on capital expenditures of $30,000,000 per fiscal year. As of June 30, 2020, the Company was in compliance with all of the financial covenants. Credit facilities also include a Met Life term loan collateralized by 1,200 gross acres of citrus grove owned by Citree ("Met Citree Loan"). This is a $5,000,000 credit facility that bears interest at a fixed rate of 5.28% per annum. Principal and interest payments are made on a quarterly basis. At June 30, 2020 and September 30, 2019, there was an outstanding balance of $4,575,000 and $4,750,000, respectively. The loan matures in February 2029. The unamortized balance of deferred financing costs related to this loan was approximately $37,000 and $40,000 at June 30, 2020 and September 30, 2019, respectively. Transition from LIBOR The Company is currently evaluating the impact of the transition from LIBOR as an interest rate benchmark to other potential alternative reference rates. Currently, the Company has debt instruments in place that reference LIBOR-based rates. The transition from LIBOR is estimated to take place in 2021 and management will continue to actively assess the related opportunities and risks involved in this transition. Silver Nip Citrus Debt There are two fixed-rate term loans, with an original combined balance of $27,550,000, bearing interest at 5.35% per annum (“Pru Loans A & B”). Principal of $290,000 is payable quarterly, together with accrued interest. On February 15, 2015, 734 Citrus Holdings, LLC d/b/a Silver Nip Citrus (“Silver Nip Citrus”) made a prepayment of $750,000. In addition, the Company made prepayments of approximately $4,453,000 in the second fiscal quarter of 2018 with proceeds from the sale of certain properties, which were collateralized under these loans. The Company may prepay up to $5,000,000 of principal without penalty. As such, the Company exceeded the allowed $5,000,000 prepayment by approximately $203,000 and was required to make a premium payment of approximately $22,000. The loans are collateralized by approximately 5,700 acres of citrus groves in Collier, Hardee, Highlands and Polk Counties, Florida and mature on June 1, 2029 and June 1, 2033, respectively. Silver Nip Citrus entered into two additional fixed-rate term loans with Prudential to finance the acquisition of a 1,500 acre citrus grove on September 4, 2014. Each loan (“Pru Loan E” and “Pru Loan F”) was in the original amount of $5,500,000. Principal of $55,000 per loan is payable quarterly, together with accrued interest. In November 2019, the Company prepaid Pru Loan F in full in the amount of $4,455,000. Pru Loan E, which matures September 1, 2021, bears interest at 3.85% per annum. The interest rate on Pru Loan E is subject to adjustment on September 1, 2019 and every year thereafter until maturity. No adjustment was made at September 1, 2019. This loan is collateralized by approximately 1,500 gross acres of citrus groves in Charlotte County, Florida. The Silver Nip Citrus credit agreements are subject to a financial covenant whereby the consolidated current ratio requirement is 1.00 to 1.00. Silver Nip Citrus was in compliance with the current ratio covenant as of June 30, 2020. The unamortized balance of deferred financing costs related to the Silver Nip Citrus debt was approximately $214,000 and $271,000 at June 30, 2020 and September 30, 2019, respectively.

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for long-term debt. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
Name: | us-gaap_LongTermDebtTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration