SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
Commission file number 0-4674
MAUI LAND & PINEAPPLE COMPANY, INC.
(Exact name of registrant as specified in its charter)
HAWAII 99-0107542
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
P.O. Box 187, KAHULUI, MAUI, HAWAII 96732
(Address of principal executive offices)
Registrant's telephone number, including area code:
(808) 877-3351
NONE
Former name, former address and former fiscal year,
if changed since last report
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes /x/ No / /
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at August 1, 1996
Common Stock, no par value 1,797,125 shares
MAUI LAND & PINEAPPLE COMPANY, INC.
AND SUBSIDIARIES
INDEX
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets - June 30, 1996 (Unaudited)
& December 31, 1995 3
Condensed Statements of Operations and Retained Earnings,
Three Months Ended June 30, 1996 & 1995 (Unaudited) 4
Condensed Statements of Operations and Retained Earnings,
Six Months Ended June 30, 1996 & 1995 (Unaudited) 5
Condensed Statements of Cash Flows,
Six Months Ended June 30, 1996 & 1995 (Unaudited) 6
Notes to Condensed Financial Statements (Unaudited) 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II. OTHER INFORMATION 10
PART I. - FINANCIAL INFORMATION
Item 1. Financial Statements
MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES
CONDENSED BALANCE SHEETS
06/30/96
(Unaudited) 12/31/95
(Dollars in Thousands)
ASSETS
Current Assets
Cash $ 855 $ 166
Accounts and notes receivable 11,393 13,142
Inventories 25,588 19,675
Other current assets 3,705 3,571
-------- --------
Total current assets 41,541 36,554
Property 188,569 185,175
Accumulated depreciation (100,845) (96,618)
-------- --------
Property - net 87,724 88,557
Other Assets 10,237 11,974
-------- --------
TOTAL 139,502 137,085
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current portion of long-term debt 14,700 --
Trade accounts payable 7,026 5,761
Other current liabilities 8,064 7,365
-------- --------
Total current liabilities 29,790 13,126
Long-Term Liabilities
Long-term debt and capital lease obligations 21,266 36,227
Accrued retirement benefits 22,640 22,594
Other long-term liabilities 6,792 6,268
-------- --------
Total long-term liabilities 50,698 65,089
Stockholders' Equity
Common stock, no par value - 1,800,000
shares authorized, 1,797,125 issued and
outstanding 12,318 12,318
Retained earnings 46,696 46,552
-------- --------
Stockholders' Equity 59,014 58,870
-------- --------
$139,502 $137,085
TOTAL ======== ========
See accompanying Notes to Condensed Financial Statements.
MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(UNAUDITED)
Three Months Ended
6/30/96 6/30/95
(Dollars in Thousands
Except Share Amounts)
REVENUES
Net sales $22,889 $17,869
Operating income 5,321 6,240
Other income 562 2,091
------- -------
Total Revenues 28,772 26,200
------- -------
COSTS AND EXPENSES
Cost of goods sold 15,733 12,812
Operating expenses 5,244 5,605
Shipping and marketing 3,620 3,172
General and administrative 3,832 3,791
Equity in losses of joint ventures 265 2,440
Interest 841 1,768
------- -------
Total Costs and Expenses 29,535 29,588
------- -------
LOSS BEFORE INCOME TAXES (763) (3,388)
INCOME TAX CREDIT (287) (1,190)
------- -------
NET LOSS (476) (2,198)
RETAINED EARNINGS, BEGINNING OF PERIOD 47,172 46,244
------- -------
RETAINED EARNINGS, END OF PERIOD 46,696 44,046
======= =======
PER COMMON SHARE
Net Loss $ (.26) $ (1.22)
======= =======
See accompanying Notes to Condensed Financial Statements.
MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(UNAUDITED)
Six Months Ended
6/30/96 6/30/95
(Dollars in Thousands
Except Share Amounts)
REVENUES
Net sales $45,394 $37,762
Operating income 11,853 15,173
Other income 1,824 3,222
------- -------
Total Revenues 59,071 56,157
------- -------
COSTS AND EXPENSES
Cost of goods sold 31,330 27,460
Operating expenses 10,784 11,932
Shipping and marketing 6,814 5,975
General and administrative 7,593 8,152
Equity in losses of joint ventures 558 4,186
Interest 1,771 4,803
------- -------
Total Costs and Expenses 58,850 62,508
------- -------
INCOME (LOSS) BEFORE INCOME TAXES 221 (6,351)
INCOME TAXES (CREDIT) 77 (2,286)
------- -------
NET INCOME (LOSS) 144 (4,065)
RETAINED EARNINGS, BEGINNING OF PERIOD 46,552 48,111
------- -------
RETAINED EARNINGS, END OF PERIOD 46,696 44,046
======= =======
PER COMMON SHARE
Net Income (Loss) $ .08 $ (2.26)
======= =======
See accompanying Notes to Condensed Financial Statements.
MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Six Months Ended
6/30/96 6/30/95
(Dollars in Thousands)
Net Cash Provided by (Used In)
Operating Activities $ 3,497 $(1,743)
------- -------
Investing Activities
Purchases of property (3,465) (4,330)
Proceeds from disposal of property 526 720
Reimbursements from Kaahumanu
Center Associates -- 11,225
Other 553 (2,227)
------- -------
Net Cash Provided by (Used In)
Investing Activities (2,386) 5,388
------- -------
Financing Activities
Payments of long-term debt & capital
lease obligations (5,472) (13,403)
Proceeds from long-term debt 5,050 7,988
Proceeds (payment) of short-term debt -- 335
------- -------
Net Cash Provided by (Used In)
Financing Activities (422) (5,080)
------- -------
Net Increase (Decrease) In Cash 689 (1,435)
Cash At Beginning of Period 166 2,269
------- -------
Cash At End of Period $ 855 $ 834
======= =======
Supplemental Disclosures of Cash Flow Information - Interest (net
of amounts capitalized) of $1,989,000 and $5,055,000 was paid
during the six months ended June 30, 1996 and 1995, respectively.
Income taxes of $185,000 were paid during the six months ended
June 30, 1996. Income tax refunds (net of payments) of $33,000
were received during the six months ended June 30, 1995. See
also Note 5 to Condensed Financial Statements.
See accompanying Notes to Condensed Financial Statements.
MAUI LAND & PINEAPPLE COMPANY, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
1. In the opinion of management, the accompanying condensed
financial statements contain all normal and recurring
adjustments necessary to present a fair statement of
financial position and results of operations for the interim
periods ended June 30, 1996 and 1995.
2. The Company's reports for interim periods utilize numerous
estimates of production, general and administrative
expenses, and other costs for the full year. Consequently,
amounts in the interim reports are not necessarily
indicative of results for the full year.
3. The effective tax rate for 1996 and 1995 differs from the
statutory federal rate of 34% primarily because of the state
tax provision and refundable state tax credits.
4. Inventories as of June 30, 1996 and December 31, 1995 were
as follows (in thousands):
06/30/96 12/31/95
Pineapple products $19,127 $13,920
Real estate held for sale 393 340
Merchandise, materials and supplies 6,068 5,415
------- -------
Total Inventories $25,588 $19,675
======= =======
5. Effective April 30, 1995, the Employees' Retirement System
of the State of Hawaii (ERS) converted its $30.6 million
loan to an additional 49% ownership in Kaahumanu Center
Associates (KCA). After the conversion, the Company no
longer consolidated KCA, but accounted for its investment in
KCA by the equity method. This resulted in a decrease to
the Company's consolidated assets and consolidated debt of
approximately $76 million.
6. Average common shares outstanding for the interim periods
ended June 30, 1996 and 1995 were 1,797,125.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
RESULTS OF OPERATIONS
Consolidated
The Company incurred a consolidated net loss for the second
quarter of 1996 of $476,000 compared to a net loss of $2.2
million for the second quarter of 1995. For the first half of
1996, consolidated net income was $144,000 compared to a net loss
of $4.1 million for the first half of 1995.
The Company's Pineapple and Resort segments and lower interest
expense due to a reduced debt level contributed to the improved
results in 1996. The net losses for the second quarter and first
half of 1995 included $1.4 million and $2.5 million,
respectively, representing the Company's equity in losses of
Kaptel Associates, which was dissolved in October 1995.
Pineapple
Pineapple operations generated increased revenues for the second
quarter and first half of 1996 compared to the same periods in
1995 due to higher prices and increased sales volume. The
improved prices and volume largely reflect the favorable ruling
in 1995 on the anti-dumping case against the Thai pineapple
producers. Operating profits were $926,000 and $1.6 million for
the second quarter and the first half of 1996, respectively,
compared to operating losses of $853,000 and $1.2 million for the
same periods in 1995.
Resort
Resort ongoing operations generated higher revenues in the second
quarter and first half of 1996 compared to the same periods in
1995, principally reflecting increased merchandise sales and
higher villa rental income. The Resort segment contributed
operating profits in the second quarter and first half of 1996
compared to operating losses for the same periods in 1995. The
operating profits for the second quarter and first half of 1996
reflect decreased equity in losses from joint venture investments
and improved operating performance from the Resort's ongoing
operations for the first half of 1996.
Commercial & Property
Commercial & Property operations reported lower revenues for the
second quarter and first half of 1996 compared to the same
periods in 1995. As a result, this segment posted an operating
loss for the second quarter of 1996 compared to operating profits
a year earlier. The first half of 1996 provided lower operating
profits compared to the same period in 1995. The reduction in
revenues and operating profits in 1996 primarily reflected fewer
real estate sales. The exclusion of Kaahumanu Center Associates
from the Company's consolidated financial statements since April
of 1995 also contributed to the lower revenues in 1996.
LIQUIDITY AND CAPITAL RESOURCES
The Company's total debt, including capital leases was $37.1
million at June 30, 1996, compared to $37.5 million at December
31, 1995. At June 30, 1996, the Company had unused lines of
credit of $8.6 million which principally expire at June 30, 1997.
Before year-end 1996, the Company expects to modify and extend
its existing credit lines and to reduce total debt as a result of
positive cash flows from operating activities. Also some of the
Company's existing debt may be refinanced with the proceeds of
new long-term debt.
For the first half of 1996 the Company produced positive cash
flows from operating activities of $3.5 million. These cash
flows were used primarily to fund capital expenditures for
equipment replacements. For the remainder of 1996 capital
expenditures are expected to be approximately $3 million. Some
of the 1996 capital expenditures are expected to be financed with
capital leases.
PART II OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security-Holders
On May 3, 1996, at the annual meeting of the Company's
shareholders, the following matters were voted upon:
Election of Class Three Directors for a three-year
term:
Shares Voted Shares
For Withheld
Mary C. Sanford 1,617,234 36,440
Richard H. Cameron 1,614,304 39,370
Election of the firm Deloitte & Touche LLP as auditor
of the Company for the fiscal year 1996:
Shares for: 1,620,362
Shares against: 30,709
Shares abstained: 2,603
Item 5. Other Information
Effective July 15, 1996, Samuel K. Himmelrich, Sr. of
the Harry Weinberg Family Foundation, Inc. was
appointed to the Board of Directors of the Company.
Mr. Himmelrich replaces Joseph W. Hartley, Jr.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(27) Financial Data Schedule
As of June 30, 1996 and for the six months then
ended. Attached.
(b) Reports on Form 8-K
There were no reports on Form 8-K filed for the
period covered by this report.
SIGNATURE
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 thereunto duly authorized.
MAUI LAND & PINEAPPLE COMPANY, INC.
August 5, 1996 /S/ PAUL J. MEYER
Date Paul J. Meyer
Executive Vice President/Finance
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This schedule contains summary financial information extracted from the Maui
Land & Pineapple Company, Inc. Balance Sheet as of June 30, 1996 and the
Statement of Operations for the six months then ended, and is qualified in its
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