x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended September 30, 2019
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OR
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¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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77-0196136
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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P.O. Box 1000, Tejon Ranch, California 93243
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(661) 248-3000
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(Address of principal executive offices) (Zip Code)
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(Registrant’s telephone number, including area code)
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Title of each class
|
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Trading symbol(s)
|
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Name of each exchange on which registered
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Common Stock, $0.50 par value
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|
TRC
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New York Stock Exchange
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Page
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PART I.
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FINANCIAL INFORMATION
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Item 1.
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Financial Statements
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Item 2.
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Item 3.
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Item 4.
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PART II.
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Item 1.
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Item 1A.
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||
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Item 2.
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Unregistered Sales of Equity Securities and Use of Proceeds
|
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Item 3.
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Defaults Upon Senior Securities
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Item 4.
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Mine Safety Disclosures
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Item 5.
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Other Information
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Item 6.
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||
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Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
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2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Real estate - commercial/industrial
|
$
|
2,620
|
|
|
$
|
2,445
|
|
|
$
|
12,041
|
|
|
$
|
6,788
|
|
Mineral resources
|
1,559
|
|
|
1,355
|
|
|
8,351
|
|
|
11,986
|
|
||||
Farming
|
4,602
|
|
|
10,836
|
|
|
6,303
|
|
|
12,573
|
|
||||
Ranch operations
|
876
|
|
|
796
|
|
|
2,570
|
|
|
2,624
|
|
||||
Total revenues
|
9,657
|
|
|
15,432
|
|
|
29,265
|
|
|
33,971
|
|
||||
Costs and Expenses:
|
|
|
|
|
|
|
|
||||||||
Real estate - commercial/industrial
|
1,968
|
|
|
1,678
|
|
|
8,353
|
|
|
4,385
|
|
||||
Real estate - resort/residential
|
582
|
|
|
471
|
|
|
1,872
|
|
|
1,319
|
|
||||
Mineral resources
|
576
|
|
|
574
|
|
|
5,006
|
|
|
5,400
|
|
||||
Farming
|
5,979
|
|
|
6,541
|
|
|
8,402
|
|
|
9,570
|
|
||||
Ranch operations
|
1,260
|
|
|
1,353
|
|
|
4,003
|
|
|
4,090
|
|
||||
Corporate expenses
|
1,760
|
|
|
2,100
|
|
|
6,524
|
|
|
7,296
|
|
||||
Total expenses
|
12,125
|
|
|
12,717
|
|
|
34,160
|
|
|
32,060
|
|
||||
Operating (loss) income
|
(2,468
|
)
|
|
2,715
|
|
|
(4,895
|
)
|
|
1,911
|
|
||||
Other Income:
|
|
|
|
|
|
|
|
||||||||
Investment income
|
294
|
|
|
351
|
|
|
972
|
|
|
980
|
|
||||
Other income (loss), net
|
19
|
|
|
(16
|
)
|
|
67
|
|
|
(40
|
)
|
||||
Total other income
|
313
|
|
|
335
|
|
|
1,039
|
|
|
940
|
|
||||
(Loss) income from operations before equity in earnings of unconsolidated joint ventures
|
(2,155
|
)
|
|
3,050
|
|
|
(3,856
|
)
|
|
2,851
|
|
||||
Equity in earnings of unconsolidated joint ventures, net
|
2,199
|
|
|
1,592
|
|
|
5,046
|
|
|
2,411
|
|
||||
Income before income tax expense
|
44
|
|
|
4,642
|
|
|
1,190
|
|
|
5,262
|
|
||||
Income tax expense
|
7
|
|
|
1,155
|
|
|
320
|
|
|
1,333
|
|
||||
Net income
|
37
|
|
|
3,487
|
|
|
870
|
|
|
3,929
|
|
||||
Net loss attributable to non-controlling interest
|
(10
|
)
|
|
(1
|
)
|
|
(3
|
)
|
|
(19
|
)
|
||||
Net income attributable to common stockholders
|
$
|
47
|
|
|
$
|
3,488
|
|
|
$
|
873
|
|
|
$
|
3,948
|
|
Net income per share attributable to common stockholders, basic
|
$
|
—
|
|
|
$
|
0.13
|
|
|
$
|
0.03
|
|
|
$
|
0.15
|
|
Net income per share attributable to common stockholders, diluted
|
$
|
—
|
|
|
$
|
0.13
|
|
|
$
|
0.03
|
|
|
$
|
0.15
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
37
|
|
|
$
|
3,487
|
|
|
$
|
870
|
|
|
$
|
3,929
|
|
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
||||||||
Unrealized gain (loss) on available-for-sale securities
|
59
|
|
|
47
|
|
|
443
|
|
|
(323
|
)
|
||||
Unrealized (loss) gain on interest rate swap
|
(1,195
|
)
|
|
449
|
|
|
(3,888
|
)
|
|
2,305
|
|
||||
Other comprehensive (loss) income before taxes
|
(1,136
|
)
|
|
496
|
|
|
(3,445
|
)
|
|
1,982
|
|
||||
Benefit (provision) for income taxes related to other comprehensive income items
|
239
|
|
|
(104
|
)
|
|
723
|
|
|
(416
|
)
|
||||
Other comprehensive (loss) income
|
(897
|
)
|
|
392
|
|
|
(2,722
|
)
|
|
1,566
|
|
||||
Comprehensive (loss) income
|
(860
|
)
|
|
3,879
|
|
|
(1,852
|
)
|
|
5,495
|
|
||||
Comprehensive loss attributable to non-controlling interests
|
(10
|
)
|
|
(1
|
)
|
|
(3
|
)
|
|
(19
|
)
|
||||
Comprehensive (loss) income attributable to common stockholders
|
$
|
(850
|
)
|
|
$
|
3,880
|
|
|
$
|
(1,849
|
)
|
|
$
|
5,514
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(unaudited)
|
|
|
||||
ASSETS
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
9,113
|
|
|
$
|
15,908
|
|
Marketable securities - available-for-sale
|
47,423
|
|
|
63,749
|
|
||
Accounts receivable
|
4,091
|
|
|
10,876
|
|
||
Inventories
|
5,790
|
|
|
2,618
|
|
||
Prepaid expenses and other current assets
|
3,558
|
|
|
3,348
|
|
||
Total current assets
|
69,975
|
|
|
96,499
|
|
||
Real estate and improvements - held for lease, net
|
18,771
|
|
|
18,953
|
|
||
Real estate development (includes $103,527 at September 30, 2019 and $100,311 at December 31, 2018, attributable to Centennial Founders, LLC, Note 15)
|
297,879
|
|
|
283,385
|
|
||
Property and equipment, net
|
46,424
|
|
|
46,086
|
|
||
Investments in unconsolidated joint ventures
|
42,177
|
|
|
28,602
|
|
||
Net investment in water assets
|
54,363
|
|
|
51,832
|
|
||
Deferred tax assets
|
1,952
|
|
|
1,229
|
|
||
Other assets
|
2,219
|
|
|
2,462
|
|
||
TOTAL ASSETS
|
$
|
533,760
|
|
|
$
|
529,048
|
|
|
|
|
|
||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current Liabilities:
|
|
|
|
||||
Trade accounts payable
|
$
|
3,744
|
|
|
$
|
6,037
|
|
Accrued liabilities and other
|
4,498
|
|
|
3,575
|
|
||
Deferred income
|
1,922
|
|
|
2,863
|
|
||
Revolving line of credit
|
5,000
|
|
|
—
|
|
||
Current maturities of long-term debt
|
4,137
|
|
|
4,018
|
|
||
Total current liabilities
|
19,301
|
|
|
16,493
|
|
||
Long-term debt, less current portion
|
58,625
|
|
|
61,780
|
|
||
Long-term deferred gains
|
5,185
|
|
|
3,405
|
|
||
Other liabilities
|
16,223
|
|
|
12,698
|
|
||
Total liabilities
|
99,334
|
|
|
94,376
|
|
||
Commitments and contingencies
|
|
|
|
||||
Equity:
|
|
|
|
||||
Tejon Ranch Co. Stockholders’ Equity
|
|
|
|
||||
Common stock, $.50 par value per share:
|
|
|
|
||||
Authorized shares - 30,000,000
|
|
|
|
||||
Issued and outstanding shares - 26,041,530 at September 30, 2019 and 25,972,080 at December 31, 2018
|
13,021
|
|
|
12,986
|
|
||
Additional paid-in capital
|
338,091
|
|
|
336,520
|
|
||
Accumulated other comprehensive loss
|
(7,579
|
)
|
|
(4,857
|
)
|
||
Retained earnings
|
75,520
|
|
|
74,647
|
|
||
Total Tejon Ranch Co. Stockholders’ Equity
|
419,053
|
|
|
419,296
|
|
||
Non-controlling interest
|
15,373
|
|
|
15,376
|
|
||
Total equity
|
434,426
|
|
|
434,672
|
|
||
TOTAL LIABILITIES AND EQUITY
|
$
|
533,760
|
|
|
$
|
529,048
|
|
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
Operating Activities
|
|
|
|
||||
Net income
|
$
|
870
|
|
|
$
|
3,929
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
3,562
|
|
|
3,284
|
|
||
Amortization of premium/discount of marketable securities
|
(80
|
)
|
|
57
|
|
||
Equity in earnings of unconsolidated joint ventures, net
|
(5,046
|
)
|
|
(2,411
|
)
|
||
Non-cash retirement plan expense
|
230
|
|
|
123
|
|
||
Non-cash profits recognized from land contribution
|
(1,667
|
)
|
|
—
|
|
||
Loss on sale of property plant and equipment
|
—
|
|
|
94
|
|
||
Deferred income taxes
|
—
|
|
|
1
|
|
||
Stock compensation expense
|
1,930
|
|
|
2,601
|
|
||
Excess tax benefit from stock-based compensation
|
52
|
|
|
18
|
|
||
Distribution of earnings from unconsolidated joint ventures
|
—
|
|
|
4,800
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables, inventories, prepaids and other assets, net
|
3,656
|
|
|
(6,784
|
)
|
||
Current liabilities, net
|
(2,952
|
)
|
|
3,117
|
|
||
Net cash provided by operating activities
|
555
|
|
|
8,829
|
|
||
Investing Activities
|
|
|
|
||||
Maturities and sales of marketable securities
|
37,274
|
|
|
24,558
|
|
||
Funds invested in marketable securities
|
(20,425
|
)
|
|
(23,451
|
)
|
||
Real estate and equipment expenditures
|
(19,195
|
)
|
|
(16,183
|
)
|
||
Reimbursement proceeds from Community Facilities District
|
—
|
|
|
1,385
|
|
||
Investment in unconsolidated joint ventures
|
(3,100
|
)
|
|
—
|
|
||
Distribution of equity from unconsolidated joint ventures
|
487
|
|
|
1,835
|
|
||
Investments in long-term water assets
|
(3,553
|
)
|
|
(2,659
|
)
|
||
Net cash used in investing activities
|
(8,512
|
)
|
|
(14,515
|
)
|
||
Financing Activities
|
|
|
|
||||
Borrowings of short-term debt
|
5,000
|
|
|
—
|
|
||
Repayments of long-term debt
|
(2,994
|
)
|
|
(3,018
|
)
|
||
Rights offering costs
|
—
|
|
|
(166
|
)
|
||
Taxes on vested stock grants
|
(844
|
)
|
|
(1,063
|
)
|
||
Net cash provided by (used in) financing activities
|
1,162
|
|
|
(4,247
|
)
|
||
Decrease in cash and cash equivalents
|
(6,795
|
)
|
|
(9,933
|
)
|
||
Cash and cash equivalents at beginning of period
|
15,908
|
|
|
20,107
|
|
||
Cash and cash equivalents at end of period
|
$
|
9,113
|
|
|
$
|
10,174
|
|
|
Common Stock Shares Outstanding
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Other Comprehensive (Loss) Income
|
|
Retained Earnings
|
|
Total Stockholders' Equity
|
|
Noncontrolling Interest
|
|
Total Equity
|
|||||||||||||||
Balance, June 30, 2019
|
26,033,402
|
|
|
$
|
13,017
|
|
|
$
|
337,870
|
|
|
$
|
(6,682
|
)
|
|
$
|
75,473
|
|
|
$
|
419,678
|
|
|
$
|
15,383
|
|
|
$
|
435,061
|
|
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
47
|
|
|
47
|
|
|
(10
|
)
|
|
37
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(897
|
)
|
|
—
|
|
|
(897
|
)
|
|
—
|
|
|
(897
|
)
|
|||||||
Restricted stock issuance
|
8,128
|
|
|
4
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock compensation
|
—
|
|
|
—
|
|
|
225
|
|
|
—
|
|
|
—
|
|
|
225
|
|
|
—
|
|
|
225
|
|
|||||||
Shares withheld for taxes and tax benefit of vested shares
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Balance, September 30, 2019
|
26,041,530
|
|
|
$
|
13,021
|
|
|
$
|
338,091
|
|
|
$
|
(7,579
|
)
|
|
$
|
75,520
|
|
|
$
|
419,053
|
|
|
$
|
15,373
|
|
|
$
|
434,426
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance, June 30, 2018
|
25,952,943
|
|
|
$
|
12,976
|
|
|
$
|
321,307
|
|
|
$
|
(4,090
|
)
|
|
$
|
70,852
|
|
|
$
|
401,045
|
|
|
$
|
28,550
|
|
|
$
|
429,595
|
|
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,488
|
|
|
3,488
|
|
|
(1
|
)
|
|
3,487
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
392
|
|
|
—
|
|
|
392
|
|
|
—
|
|
|
392
|
|
|||||||
Restricted stock issuance
|
7,319
|
|
|
4
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||||
Stock compensation
|
—
|
|
|
—
|
|
|
1,015
|
|
|
—
|
|
|
—
|
|
|
1,015
|
|
|
—
|
|
|
1,015
|
|
|||||||
Balance, September 30, 2018
|
25,960,262
|
|
|
$
|
12,980
|
|
|
$
|
322,319
|
|
|
$
|
(3,698
|
)
|
|
$
|
74,340
|
|
|
$
|
405,941
|
|
|
$
|
28,549
|
|
|
$
|
434,490
|
|
|
Common Stock Shares Outstanding
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Other Comprehensive (Loss) Income
|
|
Retained Earnings
|
|
Total Stockholders' Equity
|
|
Noncontrolling Interest
|
|
Total Equity
|
|||||||||||||||
Balance, December 31, 2018
|
25,972,080
|
|
|
$
|
12,986
|
|
|
$
|
336,520
|
|
|
$
|
(4,857
|
)
|
|
$
|
74,647
|
|
|
$
|
419,296
|
|
|
$
|
15,376
|
|
|
$
|
434,672
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
873
|
|
|
873
|
|
|
(3
|
)
|
|
870
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,722
|
)
|
|
—
|
|
|
(2,722
|
)
|
|
—
|
|
|
(2,722
|
)
|
|||||||
Restricted stock issuance
|
114,599
|
|
|
57
|
|
|
(57
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock compensation
|
—
|
|
|
—
|
|
|
2,450
|
|
|
—
|
|
|
—
|
|
|
2,450
|
|
|
—
|
|
|
2,450
|
|
|||||||
Shares withheld for taxes and tax benefit of vested shares
|
(45,149
|
)
|
|
(22
|
)
|
|
(822
|
)
|
|
—
|
|
|
—
|
|
|
(844
|
)
|
|
—
|
|
|
(844
|
)
|
|||||||
Balance, September 30, 2019
|
26,041,530
|
|
|
$
|
13,021
|
|
|
$
|
338,091
|
|
|
$
|
(7,579
|
)
|
|
$
|
75,520
|
|
|
$
|
419,053
|
|
|
$
|
15,373
|
|
|
$
|
434,426
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance, December 31, 2017
|
25,894,773
|
|
|
$
|
12,947
|
|
|
$
|
320,167
|
|
|
$
|
(5,264
|
)
|
|
$
|
70,392
|
|
|
$
|
398,242
|
|
|
$
|
28,568
|
|
|
$
|
426,810
|
|
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,948
|
|
|
3,948
|
|
|
(19
|
)
|
|
3,929
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,566
|
|
|
—
|
|
|
1,566
|
|
|
—
|
|
|
1,566
|
|
|||||||
Rights offering costs
|
—
|
|
|
—
|
|
|
(166
|
)
|
|
—
|
|
|
—
|
|
|
(166
|
)
|
|
—
|
|
|
(166
|
)
|
|||||||
Restricted stock issuance
|
110,907
|
|
|
56
|
|
|
(55
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||||
Stock compensation
|
—
|
|
|
—
|
|
|
3,413
|
|
|
—
|
|
|
—
|
|
|
3,413
|
|
|
—
|
|
|
3,413
|
|
|||||||
Shares withheld for taxes and tax benefit of vested shares
|
(45,418
|
)
|
|
(23
|
)
|
|
(1,040
|
)
|
|
—
|
|
|
—
|
|
|
(1,063
|
)
|
|
—
|
|
|
(1,063
|
)
|
|||||||
Balance, September 30, 2018
|
25,960,262
|
|
|
$
|
12,980
|
|
|
$
|
322,319
|
|
|
$
|
(3,698
|
)
|
|
$
|
74,340
|
|
|
$
|
405,941
|
|
|
$
|
28,549
|
|
|
$
|
434,490
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Weighted average number of shares outstanding:
|
|
|
|
|
|
|
|
||||
Common stock
|
26,041,353
|
|
|
25,959,546
|
|
|
26,022,022
|
|
|
25,941,243
|
|
Common stock equivalents
|
195,957
|
|
|
20,881
|
|
|
194,699
|
|
|
31,716
|
|
Diluted shares outstanding
|
26,237,310
|
|
|
25,980,427
|
|
|
26,216,721
|
|
|
25,972,959
|
|
($ in thousands)
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
Marketable Securities:
|
Fair Value
Hierarchy
|
Cost
|
|
Fair Value
|
|
Cost
|
|
Fair Value
|
||||||||
Certificates of deposit
|
|
|
|
|
|
|
|
|
||||||||
with unrecognized losses for less than 12 months
|
|
$
|
748
|
|
|
$
|
747
|
|
|
$
|
250
|
|
|
$
|
248
|
|
with unrecognized losses for more than 12 months
|
|
805
|
|
|
804
|
|
|
3,861
|
|
|
3,812
|
|
||||
with unrecognized gains
|
|
2,299
|
|
|
2,305
|
|
|
—
|
|
|
—
|
|
||||
Total Certificates of deposit
|
Level 1
|
3,852
|
|
|
3,856
|
|
|
4,111
|
|
|
4,060
|
|
||||
U.S. Treasury and agency notes
|
|
|
|
|
|
|
|
|
||||||||
with unrecognized losses for less than 12 months
|
|
6,615
|
|
|
6,611
|
|
|
3,112
|
|
|
3,105
|
|
||||
with unrecognized losses for more than 12 months
|
|
2,659
|
|
|
2,658
|
|
|
23,564
|
|
|
23,415
|
|
||||
with unrecognized gains
|
|
14,058
|
|
|
14,076
|
|
|
3
|
|
|
4
|
|
||||
Total U.S. Treasury and agency notes
|
Level 2
|
23,332
|
|
|
23,345
|
|
|
26,679
|
|
|
26,524
|
|
||||
Corporate notes
|
|
|
|
|
|
|
|
|
||||||||
with unrecognized losses for less than 12 months
|
|
2,003
|
|
|
2,002
|
|
|
13,696
|
|
|
13,665
|
|
||||
with unrecognized losses for more than 12 months
|
|
1,670
|
|
|
1,669
|
|
|
12,542
|
|
|
12,431
|
|
||||
with unrecognized gains
|
|
13,466
|
|
|
13,493
|
|
|
—
|
|
|
—
|
|
||||
Total Corporate notes
|
Level 2
|
17,139
|
|
|
17,164
|
|
|
26,238
|
|
|
26,096
|
|
||||
Municipal notes
|
|
|
|
|
|
|
|
|
||||||||
with unrecognized losses for less than 12 months
|
|
—
|
|
|
—
|
|
|
2,994
|
|
|
2,982
|
|
||||
with unrecognized losses for more than 12 months
|
|
—
|
|
|
—
|
|
|
4,116
|
|
|
4,087
|
|
||||
with unrecognized gains
|
|
3,046
|
|
|
3,058
|
|
|
—
|
|
|
—
|
|
||||
Total Municipal notes
|
Level 2
|
3,046
|
|
|
3,058
|
|
|
7,110
|
|
|
7,069
|
|
||||
|
|
$
|
47,369
|
|
|
$
|
47,423
|
|
|
$
|
64,138
|
|
|
$
|
63,749
|
|
|
September 30, 2019
|
||||||||||||||
($ in thousands)
|
2019
|
|
2020
|
|
2021
|
|
Total
|
||||||||
Certificates of deposit
|
$
|
1,801
|
|
|
$
|
2,049
|
|
|
$
|
—
|
|
|
$
|
3,850
|
|
U.S. Treasury and agency notes
|
9,235
|
|
|
13,641
|
|
|
500
|
|
|
23,376
|
|
||||
Corporate notes
|
2,558
|
|
|
14,185
|
|
|
400
|
|
|
17,143
|
|
||||
Municipal notes
|
1,050
|
|
|
2,000
|
|
|
—
|
|
|
3,050
|
|
||||
|
$
|
14,644
|
|
|
$
|
31,875
|
|
|
$
|
900
|
|
|
$
|
47,419
|
|
|
December 31, 2018
|
||||||||||||||
($ in thousands)
|
2019
|
|
2020
|
|
2021
|
|
Total
|
||||||||
Certificates of deposit
|
$
|
2,311
|
|
|
$
|
1,799
|
|
|
$
|
—
|
|
|
$
|
4,110
|
|
U.S. Treasury and agency notes
|
17,574
|
|
|
9,174
|
|
|
—
|
|
|
26,748
|
|
||||
Corporate notes
|
18,671
|
|
|
7,150
|
|
|
400
|
|
|
26,221
|
|
||||
Municipal notes
|
5,111
|
|
|
2,000
|
|
|
—
|
|
|
7,111
|
|
||||
|
$
|
43,667
|
|
|
$
|
20,123
|
|
|
$
|
400
|
|
|
$
|
64,190
|
|
($ in thousands)
|
September 30, 2019
|
|
December 31, 2018
|
||||
Real estate development
|
|
|
|
||||
Mountain Village
|
$
|
141,035
|
|
|
$
|
137,571
|
|
Centennial
|
103,527
|
|
|
100,311
|
|
||
Grapevine
|
33,823
|
|
|
31,175
|
|
||
Tejon Ranch Commerce Center
|
19,494
|
|
|
14,328
|
|
||
Real estate development
|
297,879
|
|
|
283,385
|
|
||
|
|
|
|
||||
Real estate and improvements - held for lease
|
|
|
|
||||
Tejon Ranch Commerce Center
|
21,435
|
|
|
21,327
|
|
||
Less accumulated depreciation
|
(2,664
|
)
|
|
(2,374
|
)
|
||
Real estate and improvements - held for lease, net
|
$
|
18,771
|
|
|
$
|
18,953
|
|
|
September 30, 2019
|
|
September 30, 2018
|
||||
Acre-Feet Sold
|
4,445
|
|
|
7,442
|
|
||
|
|
|
|
||||
Revenues
|
$
|
3,980
|
|
|
$
|
7,992
|
|
Cost of sales
|
3,187
|
|
|
3,679
|
|
||
Profit
|
$
|
793
|
|
|
$
|
4,313
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Banked water and water for future delivery
|
$
|
25,265
|
|
|
$
|
24,597
|
|
Transferable water
|
2,921
|
|
|
36
|
|
||
Total water held for future use at cost
|
$
|
28,186
|
|
|
$
|
24,633
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
Costs
|
|
Accumulated Depreciation
|
|
Costs
|
|
Accumulated Depreciation
|
||||||||
Dudley-Ridge water rights
|
$
|
12,203
|
|
|
$
|
(4,112
|
)
|
|
$
|
12,203
|
|
|
$
|
(3,860
|
)
|
Nickel water rights
|
18,740
|
|
|
(3,800
|
)
|
|
18,740
|
|
|
(3,320
|
)
|
||||
Tulare Lake Basin water rights
|
5,857
|
|
|
(2,711
|
)
|
|
5,857
|
|
|
(2,421
|
)
|
||||
|
$
|
36,800
|
|
|
$
|
(10,623
|
)
|
|
$
|
36,800
|
|
|
$
|
(9,601
|
)
|
Net cost of purchased water contracts
|
26,177
|
|
|
|
|
27,199
|
|
|
|
||||||
Total cost water held for future use
|
28,186
|
|
|
|
|
24,633
|
|
|
|
||||||
Net investments in water assets
|
$
|
54,363
|
|
|
|
|
$
|
51,832
|
|
|
|
(in acre-feet, unaudited)
|
September 30, 2019
|
|
December 31, 2018
|
||
Water held for future use
|
|
|
|
||
Company water bank
|
50,349
|
|
|
48,826
|
|
Transferable water
|
2,904
|
|
|
500
|
|
Total water held for future use
|
53,253
|
|
|
49,326
|
|
Purchased water contracts
|
|
|
|
||
Water Contracts (Dudley-Ridge, Nickel and Tulare)
|
10,137
|
|
|
10,137
|
|
WRMWSD - Contracts with Company
|
15,547
|
|
|
15,547
|
|
TCWD - Contracts with Company
|
5,749
|
|
|
5,749
|
|
TCWD - Banked water owned by Company
|
60,877
|
|
|
52,547
|
|
Total purchased water contracts
|
92,310
|
|
|
83,980
|
|
Total water held for future use and purchased water contracts
|
145,563
|
|
|
133,306
|
|
($ in thousands)
|
September 30, 2019
|
|
December 31, 2018
|
||||
Accrued vacation
|
$
|
793
|
|
|
$
|
761
|
|
Accrued paid personal leave
|
424
|
|
|
416
|
|
||
Accrued bonus
|
1,834
|
|
|
2,071
|
|
||
Property tax payable
|
1,043
|
|
|
—
|
|
||
Other
|
404
|
|
|
327
|
|
||
|
$
|
4,498
|
|
|
$
|
3,575
|
|
|
|
|
|
($ in thousands)
|
September 30, 2019
|
|
December 31, 2018
|
||||
Revolving line of credit
|
$
|
5,000
|
|
|
$
|
—
|
|
Notes payable
|
62,919
|
|
|
65,901
|
|
||
Other borrowings
|
—
|
|
|
14
|
|
||
Total short-term and long-term debt
|
$
|
67,919
|
|
|
$
|
65,915
|
|
Less: line-of-credit and current maturities of long-term debt
|
(9,137
|
)
|
|
(4,018
|
)
|
||
Less: deferred loan costs
|
(157
|
)
|
|
(117
|
)
|
||
Long-term debt, less current portion
|
$
|
58,625
|
|
|
$
|
61,780
|
|
|
September 30, 2019
|
|
Stock Grants Outstanding Beginning of Period at Target Achievement
|
538,599
|
|
New Stock Grants/Additional Shares due to Achievement in Excess of Target
|
160,471
|
|
Vested Grants
|
(88,786
|
)
|
Expired/Forfeited Grants
|
(92,565
|
)
|
Stock Grants Outstanding End of Period at Target Achievement
|
517,719
|
|
($ in thousands)
|
Nine Months Ended September 30,
|
||||||
Employee Plan:
|
2019
|
|
2018
|
||||
Expensed
|
$
|
1,523
|
|
|
$
|
2,072
|
|
Capitalized
|
520
|
|
|
812
|
|
||
|
2,043
|
|
|
2,884
|
|
||
NDSI Plan - Expensed
|
407
|
|
|
529
|
|
||
Total Stock Compensation Costs
|
$
|
2,450
|
|
|
$
|
3,413
|
|
Effective Date
|
|
Maturity Date
|
|
Fair Value Hierarchy
|
|
Interest Rate
|
|
Fair Value
|
|
Notional Amount
|
July 5, 2019
|
|
June 5, 2029
|
|
Level 2
|
|
4.16%
|
|
$(3,795)
|
|
$59,717
|
|
Nine Months Ended September 30,
|
||||||
($ in thousands)
|
2019
|
|
2018
|
||||
Earnings (cost) components:
|
|
|
|
||||
Interest cost
|
$
|
(291
|
)
|
|
$
|
(273
|
)
|
Expected return on plan assets
|
393
|
|
|
438
|
|
||
Net amortization and deferral
|
(57
|
)
|
|
(48
|
)
|
||
Total net periodic pension earnings
|
$
|
45
|
|
|
$
|
117
|
|
|
Nine Months Ended September 30,
|
||||||
($ in thousands)
|
2019
|
|
2018
|
||||
Cost components:
|
|
|
|
||||
Interest cost
|
$
|
(228
|
)
|
|
$
|
(192
|
)
|
Net amortization and other
|
(48
|
)
|
|
(48
|
)
|
||
Total net periodic pension cost
|
$
|
(276
|
)
|
|
$
|
(240
|
)
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Commercial revenues
|
$
|
2,620
|
|
|
$
|
2,445
|
|
|
$
|
12,041
|
|
|
$
|
6,788
|
|
Equity in earnings of unconsolidated joint ventures
|
2,199
|
|
|
1,592
|
|
|
5,046
|
|
|
2,411
|
|
||||
Commercial revenues and equity in earnings of unconsolidated joint ventures
|
4,819
|
|
|
4,037
|
|
|
17,087
|
|
|
9,199
|
|
||||
Commercial expenses
|
1,968
|
|
|
1,678
|
|
|
8,353
|
|
|
4,385
|
|
||||
Operating results from commercial and unconsolidated joint ventures
|
$
|
2,851
|
|
|
$
|
2,359
|
|
|
$
|
8,734
|
|
|
$
|
4,814
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Mineral resources revenues
|
$
|
1,559
|
|
|
$
|
1,355
|
|
|
$
|
8,351
|
|
|
$
|
11,986
|
|
Mineral resources expenses
|
576
|
|
|
574
|
|
|
5,006
|
|
|
5,400
|
|
||||
Operating results from mineral resources
|
$
|
983
|
|
|
$
|
781
|
|
|
$
|
3,345
|
|
|
$
|
6,586
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Farming revenues
|
$
|
4,602
|
|
|
$
|
10,836
|
|
|
$
|
6,303
|
|
|
$
|
12,573
|
|
Farming expenses
|
5,979
|
|
|
6,541
|
|
|
8,402
|
|
|
9,570
|
|
||||
Operating results from farming
|
$
|
(1,377
|
)
|
|
$
|
4,295
|
|
|
$
|
(2,099
|
)
|
|
$
|
3,003
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Ranch operations revenues
|
$
|
876
|
|
|
$
|
796
|
|
|
$
|
2,570
|
|
|
$
|
2,624
|
|
Ranch operations expenses
|
1,260
|
|
|
1,353
|
|
|
4,003
|
|
|
4,090
|
|
||||
Operating results from ranch operations
|
$
|
(384
|
)
|
|
$
|
(557
|
)
|
|
$
|
(1,433
|
)
|
|
$
|
(1,466
|
)
|
•
|
Petro Travel Plaza Holdings LLC – Petro Travel Plaza Holdings LLC is an unconsolidated joint venture with TravelCenters of America that develops and manages travel plazas, gas stations, convenience stores, and fast food restaurants throughout TRCC. The Company has 50% of the voting rights but participates in 60% of all profits and losses. The Company does not control the investment due to having only 50% of the voting rights. The Company's partner is the managing partner and performs all of the day-to-day operations and has significant decision-making authority over key business components such as fuel inventory and pricing at the facilities. The Company's investment in this joint venture was $24,145,000 as of September 30, 2019.
|
•
|
Majestic Realty Co. – Majestic Realty Co. (Majestic), is a privately-held developer and owner of master planned business parks throughout the United States. The Company has formed three 50/50 joint ventures with Majestic to acquire, develop, manage, and operate industrial real estate at TRCC. The partners have equal voting rights and equally share in the profit and loss of the joint ventures. The Company and Majestic guarantee the performance of all outstanding debt.
|
◦
|
In November 2018, TRC-MRC 3, LLC was formed to pursue the development, construction, leasing, and management of a 579,040 square foot industrial building located within TRCC-East. The Company anticipates construction will be completed in the fourth quarter of 2019, and plan to deliver the space in 2019 to a tenant that has leased 67% of the rentable space. In March 2019, the joint venture entered into a promissory note with a financial institution to finance the construction of the building. The note matures on May 1, 2030 and had an outstanding principal balance of $23,327,000 as of September 30, 2019. On April 1, 2019, the Company contributed land with a fair value of $5,854,000 to TRC-MRC 3, LLC in accordance with the limited liability agreement. The land contribution met the criteria of a land sale under ASC Topic 606, "Revenue from Contracts with Customers." As such, the Company recognized profit of $1,533,000 and deferred $1,532,000 of profit in accordance with ASC Topic 323, "Investment - Equity Method and Joint Ventures" on the date the land was contributed. The Company's investment in this joint venture was $5,954,000 as of September 30, 2019.
|
◦
|
TRC-MRC 2, LLC was formed to acquire, lease, and maintain a fully occupied warehouse at TRCC-West. The partnership acquired the 651,909 square foot building for $24,773,000 that was largely financed through a promissory note guaranteed by both partners. The promissory note was refinanced on June 1, 2018 with a $25,240,000 promissory note. The note matures on July 1, 2028 and has an outstanding principal balance of $24,597,000 as of September 30, 2019. Since its inception, the Company has received excess distributions resulting in a deficit balance of $2,499,000. In accordance with the applicable accounting guidance, the Company reclassified excess distributions to Other Liabilities within the Consolidated Balance Sheets. The Company will continue to record equity in earnings as a debit to the investment account and if it were to become positive, the Company will reclassify the liability to an asset. If it becomes obvious that any excess distribution may not be returned (upon joint venture liquidation or otherwise), the Company will immediately recognize the liability as income.
|
◦
|
TRC-MRC 1, LLC was formed to develop and operate a 480,480 square foot industrial building at TRCC-East. The facility is currently leased to Dollar General and L’Oréal USA, the largest subsidiary of L’Oréal. Since its inception, the Company has received excess distributions resulting in a deficit balance of $354,000. In accordance with the applicable accounting guidance, the Company reclassified excess distributions to Other Liabilities within the Consolidated Balance Sheets. The Company will continue to record equity in earnings as a debit to the investment account and if it were to become positive, the Company will reclassify the liability to an asset. If it becomes obvious that any excess distribution may not be returned (upon joint venture liquidation or otherwise), the Company will immediately recognize the liability as income. The joint venture refinanced its construction loan in December 2018 with a mortgage loan. The original balance of the mortgage loan was $25,030,000, of which $24,667,000 was outstanding as of September 30, 2019.
|
•
|
Rockefeller Joint Ventures – The Company has three joint ventures with Rockefeller Group Development Corporation, or Rockefeller. At September 30, 2019, the Company’s combined equity investment balance in these three joint ventures was $12,078,000.
|
◦
|
Two joint ventures are for the development of buildings on approximately 91 acres of land and are part of an agreement for the potential development of up to 500 acres of land in TRCC that are tied to a Foreign Trade Zone designation. The Company owns a 50% interest in each of the joint ventures. Currently, the Five West Parcel LLC joint venture owns and leases a 606,000 square foot building to Dollar General, which has now been extended to July 2022, and includes an option for an additional three years. The Five West Parcel LLC joint venture currently has an outstanding term loan with a balance of $8,769,000 that matures on May 5, 2022. The Company and Rockefeller guarantee up to 25% of the performance of the debt. The second of these joint ventures, 18-19 West LLC, was formed in August 2009 through the contribution of 63.5 acres of land by the Company, which is being held for future development. Both of these joint ventures are being accounted for under the equity method due to both members having significant participating rights in the management of the ventures.
|
◦
|
The third joint venture is the TRCC/Rock Outlet Center LLC joint venture that was formed in of 2013 to develop, own, and manage a net leasable 326,000 square foot outlet center on land at TRCC-East. The Company controls 50% of the voting interests of TRCC/Rock Outlet Center LLC; thus, it does not control the joint venture by voting interest alone. The Company is the named managing member. The managing member's responsibilities relate to the routine day-to-day activities of TRCC/Rock Outlet Center LLC. However, all operating decisions during the development period and ongoing operations, including the setting and monitoring of the budget, leasing, marketing, financing and selection of the contractor for any construction, are jointly made by both members of the joint venture. Therefore, the Company concluded that both members have significant participating rights that are sufficient to overcome the presumption of the Company controlling the joint venture through it being named the managing member. Therefore, the investment in TRCC/Rock Outlet Center LLC is being accounted for under the equity method. The TRCC/Rock Outlet Center LLC joint venture has a term note with a financial institution that matures on September 5, 2021. As of September 30, 2019, the outstanding balance of the term note was $39,393,000. The Company and Rockefeller guarantee the performance of the debt.
|
•
|
Centennial Founders, LLC – Centennial Founders, LLC, (CFL), is a joint venture that was initially formed with TRI Pointe Homes, Lewis Investment Company, (Lewis), and CalAtlantic to pursue the entitlement and development of land that the Company owns in Los Angeles County. Based on the Second Amended and Restated Limited Company Agreement of CFL and the change in control and funding that resulted from the amended agreement, CFL qualified as a VIE beginning in 2009, and the Company was determined to be the primary beneficiary. As a result, CFL is now consolidated into the Company's financial statements. The Company's partners retained a noncontrolling interest in the joint venture. On November 30, 2016, CFL and Lewis entered a Redemption and Withdrawal Agreement, whereby Lewis irrevocably and unconditionally withdrew as a member of CFL, and CFL redeemed Lewis' entire interest for no consideration. As a result, the Company's noncontrolling interest balance was reduced by $11,039,000. On December 31, 2018, CFL and CalAtlantic entered a Redemption and Withdrawal Agreement, whereby CalAtlantic irrevocably and unconditionally withdrew as a member of CFL, and CFL redeemed CalAtlantic's entire interest for no consideration. As a result, the noncontrolling interest balance was reduced by $13,172,000. At September 30, 2019, the Company owned 92.50% of CFL.
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||
|
Joint Venture
|
|
TRC
|
||||||||||||||||||||
($ in thousands)
|
Revenues
|
|
Earnings(Loss)
|
|
Equity in Earnings(Loss)
|
||||||||||||||||||
Petro Travel Plaza Holdings, LLC
|
$
|
88,015
|
|
|
$
|
88,321
|
|
|
$
|
9,534
|
|
|
$
|
6,375
|
|
|
$
|
5,720
|
|
|
$
|
3,825
|
|
Five West Parcel, LLC
|
2,200
|
|
|
2,057
|
|
|
732
|
|
|
597
|
|
|
366
|
|
|
298
|
|
||||||
18-19 West, LLC
|
12
|
|
|
10
|
|
|
(80
|
)
|
|
(77
|
)
|
|
(40
|
)
|
|
(38
|
)
|
||||||
TRCC/Rock Outlet Center, LLC1
|
4,878
|
|
|
4,962
|
|
|
(2,849
|
)
|
|
(3,312
|
)
|
|
(1,424
|
)
|
|
(1,656
|
)
|
||||||
TRC-MRC 1, LLC
|
2,283
|
|
|
556
|
|
|
51
|
|
|
(426
|
)
|
|
25
|
|
|
(213
|
)
|
||||||
TRC-MRC 2, LLC
|
2,988
|
|
|
3,001
|
|
|
799
|
|
|
391
|
|
|
399
|
|
|
195
|
|
||||||
Total
|
$
|
100,376
|
|
|
$
|
98,907
|
|
|
$
|
8,187
|
|
|
$
|
3,548
|
|
|
$
|
5,046
|
|
|
$
|
2,411
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Centennial Founders, LLC
|
$
|
333
|
|
|
$
|
210
|
|
|
$
|
(36
|
)
|
|
$
|
(224
|
)
|
|
Consolidated
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(1) Revenues for TRCC/Rock Outlet Center are presented net of non-cash tenant allowance amortization of $1.3 million and $1.2 million as of September 30, 2019 and 2018, respectively.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||
|
Joint Venture
|
TRC
|
|
Joint Venture
|
TRC
|
||||||||||||||||||||
($ in thousands)
|
Assets
|
Debt
|
Equity
|
Equity
|
|
Assets
|
Debt
|
Equity
|
Equity
|
||||||||||||||||
Petro Travel Plaza Holdings, LLC
|
$
|
78,570
|
|
$
|
(15,286
|
)
|
$
|
60,909
|
|
$
|
24,145
|
|
|
$
|
69,096
|
|
$
|
(15,283
|
)
|
$
|
51,377
|
|
$
|
18,426
|
|
Five West Parcel, LLC
|
15,651
|
|
(8,769
|
)
|
6,482
|
|
3,057
|
|
|
15,157
|
|
(9,173
|
)
|
5,751
|
|
2,691
|
|
||||||||
18-19 West, LLC
|
4,632
|
|
—
|
|
4,627
|
|
1,743
|
|
|
4,654
|
|
—
|
|
4,654
|
|
1,783
|
|
||||||||
TRCC/Rock Outlet Center, LLC
|
71,271
|
|
(39,393
|
)
|
30,682
|
|
7,278
|
|
|
75,194
|
|
(46,826
|
)
|
27,531
|
|
5,702
|
|
||||||||
TRC-MRC 1, LLC
|
29,118
|
|
(24,667
|
)
|
3,839
|
|
—
|
|
|
29,692
|
|
(25,030
|
)
|
4,018
|
|
—
|
|
||||||||
TRC-MRC 2, LLC
|
20,255
|
|
24,597
|
|
(7,746
|
)
|
—
|
|
|
20,362
|
|
(25,014
|
)
|
(5,763
|
)
|
—
|
|
||||||||
TRC-MRC 3, LLC
|
31,378
|
|
(23,327
|
)
|
6,054
|
|
5,954
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Total
|
$
|
250,875
|
|
$
|
(86,845
|
)
|
$
|
104,847
|
|
$
|
42,177
|
|
|
$
|
214,155
|
|
$
|
(121,326
|
)
|
$
|
87,568
|
|
$
|
28,602
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Centennial Founders, LLC
|
$
|
95,789
|
|
$
|
—
|
|
$
|
95,462
|
|
***
|
|
|
$
|
93,840
|
|
$
|
—
|
|
$
|
93,188
|
|
***
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
*** Centennial Founders, LLC is consolidated within the Company's financial statements.
|
•
|
Our joint venture with TravelCenters of America, or TA/Petro, owns and operates two travel and truck stop facilities, and also operates five separate gas stations with convenience stores and fast food restaurants within TRCC-West and TRCC-East.
|
•
|
Three joint ventures with Rockefeller Development Group, or Rockefeller:
|
◦
|
Five West Parcel LLC owns a 606,000 square foot building in TRCC-West that is fully leased;
|
◦
|
18-19 West LLC owns 63.5 acres of land for future development within TRCC-West;
|
◦
|
TRCC/Rock Outlet Center LLC operates the Outlets at Tejon, a net leasable 326,000 square foot shopping experience in TRCC-East;
|
•
|
Three joint ventures with Majestic Realty Co., or Majestic, to develop, manage, and operate industrial buildings within TRCC:
|
◦
|
TRC-MRC 1, LLC was formed to develop and operate a 480,480 square foot industrial building in TRCC-East, which was completed during 2017 and is fully leased;
|
◦
|
TRC-MRC 2, LLC owns a 651,909 square foot building in TRCC-West that is fully leased;
|
◦
|
TRC-MRC 3, LLC was formed to pursue the development, construction, leasing and management of a 579,040 square foot industrial building in TRCC-East. During the first quarter of 2019, and prior to the completion of the building, the joint venture executed a lease for 67% of the building. We anticipate construction will be completed during the fourth quarter of 2019.
|
•
|
MV encompasses a total of 26,417 acres, of which 5,082 acres will be used for the mixed-use development that will include housing, retail, and commercial components. MV is entitled for 3,450 homes, 160,000 square feet of commercial development, 750 hotel keys, and more than 21,335 acres of open space. The tentative tract map for the first four phases of residential development has also been approved.
|
•
|
The Centennial development is a mixed-use master planned community development encompassing 12,323 acres of our land within Los Angeles County. Upon completion of Centennial, it is estimated that the community will include approximately 19,333 homes and 10.1 million square feet of commercial development.
|
•
|
Grapevine is an 8,010-acre potential development area located on the San Joaquin Valley floor area of our lands, adjacent to TRCC. Upon completion of Grapevine, the community will include 12,000 homes, 5.1 million square feet for commercial development, and more than 3,367 acres of open space and parks.
|
|
Three Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Commercial revenues
|
|
|
|
|
|
|
|
|||||||
Pastoria Energy Facility
|
$
|
1,088
|
|
|
$
|
1,231
|
|
|
$
|
(143
|
)
|
|
(12
|
)%
|
TRCC Leasing
|
427
|
|
|
431
|
|
|
(4
|
)
|
|
(1
|
)%
|
|||
TRCC management fees and reimbursements
|
318
|
|
|
212
|
|
|
106
|
|
|
50
|
%
|
|||
Commercial leases
|
167
|
|
|
178
|
|
|
(11
|
)
|
|
(6
|
)%
|
|||
Communication leases
|
223
|
|
|
215
|
|
|
8
|
|
|
4
|
%
|
|||
Landscaping and other
|
397
|
|
|
178
|
|
|
219
|
|
|
123
|
%
|
|||
Total commercial revenues
|
$
|
2,620
|
|
|
$
|
2,445
|
|
|
$
|
175
|
|
|
7
|
%
|
Total commercial expenses
|
$
|
1,968
|
|
|
$
|
1,678
|
|
|
$
|
290
|
|
|
17
|
%
|
Operating income from commercial/industrial
|
$
|
652
|
|
|
$
|
767
|
|
|
$
|
(115
|
)
|
|
(15
|
)%
|
•
|
Commercial/industrial real estate development segment revenues were $2,620,000 for the three months ended September 30, 2019, an increase of $175,000, or 7%, from $2,445,000 for the three months ended September 30, 2018. The increase in commercial revenues is primarily attributed to a $219,000 increase in other revenues associated with a land purchase option arrangement.
|
•
|
Commercial/industrial real estate development segment expenses were $1,968,000 for the three months ended September 30, 2019, an increase of $290,000, or 17%, from $1,678,000 for the three months ended September 30, 2018. The increase in expense is attributed to a $565,000 increase in Tejon-Castac Water District, or TCWD, fixed water assessments. This increase was offset by a $92,000 decrease in general and administrative overhead, a $59,000 decrease in marketing expenses, and a $44,000 decrease in stock compensation.
|
|
Nine Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Commercial revenues
|
|
|
|
|
|
|
|
|||||||
Pastoria Energy Facility
|
$
|
3,487
|
|
|
$
|
3,132
|
|
|
$
|
355
|
|
|
11
|
%
|
TRCC Leasing
|
1,295
|
|
|
1,267
|
|
|
28
|
|
|
2
|
%
|
|||
TRCC management fees and reimbursements
|
912
|
|
|
612
|
|
|
300
|
|
|
49
|
%
|
|||
Commercial leases
|
486
|
|
|
523
|
|
|
(37
|
)
|
|
(7
|
)%
|
|||
Communication leases
|
695
|
|
|
696
|
|
|
(1
|
)
|
|
—
|
%
|
|||
Landscaping and other
|
853
|
|
|
558
|
|
|
295
|
|
|
53
|
%
|
|||
Land sale
|
4,313
|
|
|
—
|
|
|
4,313
|
|
|
100
|
%
|
|||
Total commercial revenues
|
$
|
12,041
|
|
|
$
|
6,788
|
|
|
$
|
5,253
|
|
|
77
|
%
|
Total commercial expenses
|
$
|
8,353
|
|
|
$
|
4,385
|
|
|
$
|
3,968
|
|
|
90
|
%
|
Operating income from commercial/industrial
|
$
|
3,688
|
|
|
$
|
2,403
|
|
|
$
|
1,285
|
|
|
53
|
%
|
•
|
Commercial/industrial real estate development segment revenues were $12,041,000 for the first nine months of 2019, an increase of $5,253,000, or 77%, from $6,788,000 for the first nine months of 2018. The increase is primarily attributed to a $4,313,000 increase in land sales revenues associated with a land contribution to TRC-MRC 3 as discussed in Note 15 (Investment in Unconsolidated and Consolidated Joint Ventures). Other factors contributing to improved revenues include improved spark spread revenues from the Pastoria Energy Facility of $355,000, or 11%, resulting from higher than expected 2018 spark spread estimates. There was also an increase in TRCC management fees and reimbursements of $300,000 resulting from management fees earned through the ongoing development and construction of TRC-MRC 3. Lastly, the Company earned $200,000 from a land purchase option arrangement in 2019.
|
•
|
Commercial/industrial real estate development segment expenses were $8,353,000 during the first nine months of 2019, an increase of $3,968,000, or 90%, from $4,385,000 during the first nine months of 2018. This increase is primarily attributed to increased land cost of sales of $2,780,000 tied to the land contribution described above and TCWD fixed water assessments of $1,255,000 as discussed previously.
|
•
|
For Centennial, the Los Angeles County Board of Supervisors gave final approval to the specific plan on April 30, 2019. The specific plan for Centennial includes 19,333 residential units and more than 10.1 million square feet of commercial space. The Company is working with the County of Los Angeles and the Los Angeles County Board of Supervisors to address the recently filed action in Los Angeles Superior Court. See Note 12 (Commitments and Contingencies) of the Notes to Unaudited Consolidated Financial Statements for further discussion.
|
•
|
For Grapevine, in December 2018, the Kern County Superior Court ruled that portions of the environmental impact report required corrections and ordered that Kern County rescind the Grapevine project approvals until such supplemental environmental analysis was completed. The Company is working on filing new applications to re-entitle the Grapevine project.
|
•
|
For MV, we have a fully entitled project and received approval of Tentative Tract Map 1 for our first four phases of development. The timing of the MV development in the coming years will depend on the strength of both the economy and the real estate market, including both primary and second home markets. In moving the project forward, we will focus on the preparation of engineering leading to the final map for the first phases of MV, consumer and market research studies and fine tuning of development business plans, as well as defining the possible capital funding sources for this development. Over the next several years, we expect to explore funding opportunities for the future development of our projects. Such funding opportunities could come from a variety of sources, such as joint ventures with financial partners, debt financing, or the Company’s issuance of additional common stock.
|
|
Three Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Mineral resources revenues
|
|
|
|
|
|
|
|
|||||||
Oil and gas
|
$
|
521
|
|
|
$
|
584
|
|
|
$
|
(63
|
)
|
|
(11
|
)%
|
Cement
|
579
|
|
|
481
|
|
|
98
|
|
|
20
|
%
|
|||
Rock aggregate
|
412
|
|
|
301
|
|
|
111
|
|
|
37
|
%
|
|||
Exploration leases
|
26
|
|
|
26
|
|
|
—
|
|
|
—
|
%
|
|||
Water Sales
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|||
Reimbursables and other
|
21
|
|
|
(37
|
)
|
|
58
|
|
|
(157
|
)%
|
|||
Total mineral resources revenues
|
$
|
1,559
|
|
|
$
|
1,355
|
|
|
$
|
204
|
|
|
15
|
%
|
Total mineral resources expenses
|
$
|
576
|
|
|
$
|
574
|
|
|
$
|
2
|
|
|
—
|
%
|
Operating income from mineral resources
|
$
|
983
|
|
|
$
|
781
|
|
|
$
|
202
|
|
|
26
|
%
|
•
|
Mineral resources segment revenues were $1,559,000 for the three months ended September 30, 2019, an increase of $204,000, or 15%, from $1,355,000 for the three months ended September 30, 2018. The increase is primarily attributed to improved cement and rock aggregate revenues as a result of increased production and pricing. Production is increasing as a result of road construction projects within California.
|
•
|
Mineral resources segment expenses were $576,000 for the three months ended September 30, 2019, representing a de minimis increase of $2,000 when compared to the same period in 2018.
|
|
Nine Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Mineral resources revenues
|
|
|
|
|
|
|
|
|||||||
Oil and gas
|
$
|
1,513
|
|
|
$
|
1,745
|
|
|
$
|
(232
|
)
|
|
(13
|
)%
|
Cement
|
1,395
|
|
|
1,309
|
|
|
86
|
|
|
7
|
%
|
|||
Rock aggregate
|
917
|
|
|
847
|
|
|
70
|
|
|
8
|
%
|
|||
Exploration leases
|
77
|
|
|
77
|
|
|
—
|
|
|
—
|
%
|
|||
Water Sales
|
3,980
|
|
|
7,992
|
|
|
(4,012
|
)
|
|
(50
|
)%
|
|||
Reimbursables and other
|
469
|
|
|
16
|
|
|
453
|
|
|
2,831
|
%
|
|||
Total mineral resources revenues
|
$
|
8,351
|
|
|
$
|
11,986
|
|
|
$
|
(3,635
|
)
|
|
(30
|
)%
|
Total mineral resources expenses
|
$
|
5,006
|
|
|
$
|
5,400
|
|
|
$
|
(394
|
)
|
|
(7
|
)%
|
Operating income from mineral resources
|
$
|
3,345
|
|
|
$
|
6,586
|
|
|
$
|
(3,241
|
)
|
|
(49
|
)%
|
•
|
Mineral resources segment revenues were $8,351,000 for the first nine months of 2019, a decrease of $3,635,000, or 30%, from $11,986,000 for the first nine months of 2018. The decrease is primarily attributed to decreased water sales revenue of $4,012,000, or 50%. California, during the winter of 2019, experienced above average rain and snow fall, which not only reduced water sales opportunities but also pricing. Partially offsetting the decrease above was a $453,000 improvement in reimbursables and other revenues as a result of charges to a local water district for use of one of the Company's water turnouts.
|
•
|
Mineral resources segment expenses were $5,006,000 for the first nine months of 2019, a decrease of $394,000, or 7%, when compared to the same period in 2018. The decrease in expense is primarily associated with decreased water cost of sales of $492,000 as a result of the reduced 2019 water sales opportunities discussed above.
|
|
Three Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Farming revenues
|
|
|
|
|
|
|
|
|||||||
Almonds
|
$
|
598
|
|
|
$
|
1,761
|
|
|
$
|
(1,163
|
)
|
|
(66
|
)%
|
Pistachios
|
2,154
|
|
|
7,042
|
|
|
(4,888
|
)
|
|
(69
|
)%
|
|||
Wine grapes
|
1,622
|
|
|
1,483
|
|
|
139
|
|
|
9
|
%
|
|||
Hay
|
96
|
|
|
199
|
|
|
(103
|
)
|
|
(52
|
)%
|
|||
Other
|
132
|
|
|
351
|
|
|
(219
|
)
|
|
(62
|
)%
|
|||
Total farming revenues
|
$
|
4,602
|
|
|
$
|
10,836
|
|
|
$
|
(6,234
|
)
|
|
(58
|
)%
|
Total farming expenses
|
$
|
5,979
|
|
|
$
|
6,541
|
|
|
$
|
(562
|
)
|
|
(9
|
)%
|
Operating (loss) income from farming
|
$
|
(1,377
|
)
|
|
$
|
4,295
|
|
|
$
|
(5,672
|
)
|
|
(132
|
)%
|
•
|
Farming segment revenues were $4,602,000 for the three months ended September 30, 2019, a decrease of $6,234,000, or 58%, from $10,836,000 during the same period in 2018. The changes are primarily attributed to:
|
◦
|
For the quarter ended September 30, 2019, the Company sold 959,000 pounds of pistachios compared to 3,500,000 pounds for the same period last year resulting in a $4,888,000 decrease in revenues. The significant decrease in sales is driven by lower production as the 2019 crop year is a down bearing crop year for pistachios. Of the quantity sold, 819,000 pounds and 140,000 pounds pertain to the 2019 current crop and 2018 carryover crop, respectively. The Company has filed an insurance claim to recover a portion of the lost production.
|
◦
|
Almond revenues decreased $1,163,000 as a result of a decrease in almond sales. Comparatively we sold 216,000 and 615,000 pounds of our current year crop as of September 30, 2019 and 2018, respectively. The decrease is attributed to timing differences in which almonds were processed and sold to our largest customer. In the quarters ended September 30, 2019 and 2018, we sold zero and 360,000 pounds of current year almonds, respectively, to our largest customer. We expect almond sales to be completed during the fourth quarter.
|
◦
|
We experienced a $219,000 decrease in other revenues as a result of lower water usage reimbursements from a farm land tenant as a result of having fewer acres leased.
|
•
|
Farming segment expenses were $5,979,000 for the three months ended September 30, 2019, a decrease of $562,000, or 9%, from $6,541,000 during the same period in 2018. The decrease in farming expenses is attributed to the following:
|
◦
|
Pistachio cost of sales increased $926,000 as a result of selling our entire pistachio crop as of September 30, 2019. Total pistachio production costs remain consistent over the comparative period.
|
◦
|
Almond cost of sales decreased $794,000 as a result of the timing of 2019 current year crop sales as discussed above.
|
◦
|
Water holding costs from WRMWSD decreased $703,000 as a result of the heavier rainfalls discussed within our Mineral Resources section above.
|
|
Nine Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Farming revenues
|
|
|
|
|
|
|
|
|||||||
Almonds
|
$
|
1,293
|
|
|
$
|
2,935
|
|
|
$
|
(1,642
|
)
|
|
(56
|
)%
|
Pistachios
|
2,799
|
|
|
7,126
|
|
|
(4,327
|
)
|
|
(61
|
)%
|
|||
Wine grapes
|
1,632
|
|
|
1,483
|
|
|
149
|
|
|
10
|
%
|
|||
Hay
|
332
|
|
|
210
|
|
|
122
|
|
|
58
|
%
|
|||
Other
|
247
|
|
|
819
|
|
|
(572
|
)
|
|
(70
|
)%
|
|||
Total farming revenues
|
$
|
6,303
|
|
|
$
|
12,573
|
|
|
$
|
(6,270
|
)
|
|
(50
|
)%
|
Total farming expenses
|
$
|
8,402
|
|
|
$
|
9,570
|
|
|
$
|
(1,168
|
)
|
|
(12
|
)%
|
Operating (loss) income from farming
|
$
|
(2,099
|
)
|
|
$
|
3,003
|
|
|
$
|
(5,102
|
)
|
|
(170
|
)%
|
•
|
Farming segment revenues were $6,303,000 for the first nine months of 2019, a decrease of $6,270,000, or 50%, from $12,573,000 during the same period in 2018. The changes are primarily attributed to:
|
◦
|
Pistachio revenues decreased $4,327,000 for the same reasons discussed within our quarterly farming results. Comparatively we sold 819,000 and 3,500,000 pounds of our 2019 and 2018 current year crop, respectively. With respect to carryover crop, we sold 419,000 and 9,300, in 2019 and 2018, respectively.
|
◦
|
Almond revenues decreased $1,642,000 for the same reasons discussed within our quarterly farming results. Comparatively we sold 216,000 and 578,000 pounds of our 2019 and 2018 current year crop, respectively. With respect to our carryover crop we sold 126,000 and 412,000 pounds of our prior year crop in 2019 and 2018, respectively.
|
◦
|
Other revenues decreased $572,000 for the same reasons discussed within our quarterly farming results.
|
•
|
Farming segment expenses were $8,402,000 for the first nine months of 2019, a decrease of $1,168,000, or 12%, from $9,570,000 when compared to the same period in 2018. We saw decreases in almond cost of sales of $1,471,000 as a result of the timing of the sale of almonds. We also saw decreases in WRMWSD of $630,000 for the same reasons discussed within our quarterly results. Lastly, we saw an increase in pistachio cost of sales of $942,000 for the same reasons discussed within the quarterly results.
|
|
Three Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Ranch Operations revenues
|
|
|
|
|
|
|
|
|||||||
Game Management and other 1
|
$
|
471
|
|
|
$
|
459
|
|
|
$
|
12
|
|
|
3
|
%
|
Grazing
|
405
|
|
|
337
|
|
|
68
|
|
|
20
|
%
|
|||
Total Ranch Operations revenues
|
$
|
876
|
|
|
$
|
796
|
|
|
$
|
80
|
|
|
10
|
%
|
Total Ranch Operations expenses
|
$
|
1,260
|
|
|
$
|
1,353
|
|
|
$
|
(93
|
)
|
|
(7
|
)%
|
Operating loss from Ranch Operations
|
$
|
(384
|
)
|
|
$
|
(557
|
)
|
|
$
|
173
|
|
|
(31
|
)%
|
1 Game management and other revenues consist of revenues from hunting, filming, high desert hunt club (a premier upland bird hunting club), and other ancillary activities.
|
•
|
Ranch operations revenues were $876,000 for the three months ended September 30, 2019, an increase of $80,000, or 10%, from $796,000 for the same period in 2018. The increase is primarily attributed to improved grazing revenues.
|
•
|
Ranch operations expenses were $1,260,000 for the three months ended September 30, 2019, a decrease of $93,000, or 7%, from $1,353,000 for the same period in 2018. The primary driver of this improvement was a reduction in general and overhead costs of $42,000, stock compensation of $18,000 as a result of not meeting performance measures, and fuel costs of $9,000.
|
•
|
Ranch operations revenues were $2,570,000 for the first nine months of 2019, a decrease of $54,000, or 2%, from $2,624,000 for the same period in 2018. The decrease is primarily attributed to reduced hunting membership revenues of $170,000 offset by a $73,000 improvement in grazing leases and a $45,000 increase in filming location revenues.
|
•
|
Ranch operations expenses were $4,003,000 for the first nine months of 2019, a decrease of $87,000, or 2%, from $4,090,000 for the same period in 2018. The decrease is primarily attributed to reduced payroll and salaries of $85,000.
|
|
Three Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Equity in earnings (loss)
|
|
|
|
|
|
|
|
|||||||
Petro Travel Plaza Holdings, LLC
|
$
|
2,244
|
|
|
$
|
2,119
|
|
|
$
|
125
|
|
|
6
|
%
|
Five West Parcel, LLC
|
160
|
|
|
90
|
|
|
70
|
|
|
78
|
%
|
|||
18-19 West, LLC
|
(13
|
)
|
|
(12
|
)
|
|
(1
|
)
|
|
8
|
%
|
|||
TRCC/Rock Outlet Center, LLC
|
(364
|
)
|
|
(479
|
)
|
|
115
|
|
|
(24
|
)%
|
|||
TRC-MRC 1, LLC
|
14
|
|
|
(162
|
)
|
|
176
|
|
|
(109
|
)%
|
|||
TRC-MRC 2, LLC
|
158
|
|
|
36
|
|
|
122
|
|
|
339
|
%
|
|||
Total equity in earnings
|
$
|
2,199
|
|
|
$
|
1,592
|
|
|
$
|
607
|
|
|
38
|
%
|
•
|
Equity in earnings were $2,199,000 for the three, months ended September 30, 2019 an increase of $607,000, or 38%, from $1,592,000 during the same period in 2018. The changes are primarily attributed to the following:
|
•
|
A $125,000 improvement for our TA/Petro joint venture resulting from improved fuel margins.
|
•
|
A $115,000 improvement for our TRCC/Rock Outlet Center joint venture resulting from lower depreciation and amortization, tenant allowance amortization, and receivable write-offs.
|
•
|
A $176,000 improvement for our TRC-MRC 1 joint venture as a result of the rent abatement period ending in June 2019.
|
•
|
A $122,000 improvement for our TRC-MRC 2 joint venture as a result of completing amortization of intangible assets during the first quarter of 2019. In contrast, the prior year had three months of amortization.
|
|
Nine Months Ended September 30,
|
|
Change
|
|||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
Equity in earnings (loss)
|
|
|
|
|
|
|
|
|||||||
Petro Travel Plaza Holdings, LLC
|
$
|
5,720
|
|
|
$
|
3,825
|
|
|
$
|
1,895
|
|
|
50
|
%
|
Five West Parcel, LLC
|
366
|
|
|
298
|
|
|
68
|
|
|
23
|
%
|
|||
18-19 West, LLC
|
(40
|
)
|
|
(38
|
)
|
|
(2
|
)
|
|
5
|
%
|
|||
TRCC/Rock Outlet Center, LLC
|
(1,424
|
)
|
|
(1,656
|
)
|
|
232
|
|
|
(14
|
)%
|
|||
TRC-MRC 1, LLC
|
25
|
|
|
(213
|
)
|
|
238
|
|
|
(112
|
)%
|
|||
TRC-MRC 2, LLC
|
399
|
|
|
195
|
|
|
204
|
|
|
105
|
%
|
|||
Total equity in earnings
|
$
|
5,046
|
|
|
$
|
2,411
|
|
|
$
|
2,635
|
|
|
109
|
%
|
•
|
Equity in earnings were $5,046,000 for the nine, months ended September 30, 2019 an increase of $2,635,000, or 109%, from $2,411,000 during the same period in 2018. The changes are primarily attributed to the following:
|
•
|
A $1,895,000 improvement in our share of earnings from our TA/Petro joint venture as a result of improved fuel margins.
|
•
|
A $232,000 improvement within our TRCC/Rock Outlet Center as a result of having fewer tenant allowance write-offs.
|
•
|
A $442,000 improvement within our Majestic Joint ventures as of September 30, 2019 for the same reasons discussed within our quarterly results.
|
(in thousands)
|
2019
|
|
2018
|
||||
Operating activities
|
$
|
555
|
|
|
$
|
8,829
|
|
Investing activities
|
$
|
(8,512
|
)
|
|
$
|
(14,515
|
)
|
Financing activities
|
$
|
1,162
|
|
|
$
|
(4,247
|
)
|
|
Payments Due by Period
|
||||||||||||||||||
(In thousands)
|
Total
|
|
One Year or Less
|
|
Years 2-3
|
|
Years 4-5
|
|
Thereafter
|
||||||||||
Contractual Obligations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Estimated water payments
|
$
|
250,219
|
|
|
$
|
9,091
|
|
|
$
|
18,527
|
|
|
$
|
19,175
|
|
|
$
|
203,426
|
|
Long-term debt
|
62,919
|
|
|
4,137
|
|
|
8,818
|
|
|
9,646
|
|
|
40,318
|
|
|||||
Interest on long-term debt
|
16,150
|
|
|
2,528
|
|
|
4,520
|
|
|
3,750
|
|
|
5,352
|
|
|||||
Revolving line of credit borrowings
|
5,000
|
|
|
5,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Cash contract commitments
|
11,077
|
|
|
8,868
|
|
|
1,138
|
|
|
—
|
|
|
1,071
|
|
|||||
Defined Benefit Plan
|
3,776
|
|
|
69
|
|
|
567
|
|
|
646
|
|
|
2,494
|
|
|||||
SERP
|
4,934
|
|
|
132
|
|
|
1,042
|
|
|
1,022
|
|
|
2,738
|
|
|||||
Tejon Ranch Conservancy
|
1,800
|
|
|
200
|
|
|
1,600
|
|
|
—
|
|
|
—
|
|
|||||
Financing fees
|
163
|
|
|
163
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total contractual obligations
|
$
|
356,038
|
|
|
$
|
30,188
|
|
|
$
|
36,212
|
|
|
$
|
34,239
|
|
|
$
|
255,399
|
|
|
Amount of Commitment Expiration Per Period
|
||||||||||||||||||
($ in thousands)
|
Total
|
|
< 1 year
|
|
2 -3 Years
|
|
4 -5 Years
|
|
After 5 Years
|
||||||||||
Other Commercial Commitments:
|
|
|
|
|
|
|
|
|
|
||||||||||
Standby letter of credit
|
$
|
4,468
|
|
|
$
|
—
|
|
|
$
|
4,468
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total other commercial commitments
|
$
|
4,468
|
|
|
$
|
—
|
|
|
$
|
4,468
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
37
|
|
|
$
|
3,487
|
|
|
$
|
870
|
|
|
$
|
3,929
|
|
Net loss attributable to non-controlling interest
|
(10
|
)
|
|
(1
|
)
|
|
(3
|
)
|
|
(19
|
)
|
||||
Net income attributable to common stockholders
|
47
|
|
|
3,488
|
|
|
873
|
|
|
3,948
|
|
||||
Interest, net
|
|
|
|
|
|
|
|
||||||||
Consolidated
|
(294
|
)
|
|
(351
|
)
|
|
(972
|
)
|
|
(980
|
)
|
||||
Our share of interest expense from unconsolidated joint ventures
|
708
|
|
|
712
|
|
|
2,176
|
|
|
1,768
|
|
||||
Total interest, net
|
414
|
|
|
361
|
|
|
1,204
|
|
|
788
|
|
||||
Income taxes
|
7
|
|
|
1,155
|
|
|
320
|
|
|
1,333
|
|
||||
Depreciation and amortization:
|
|
|
|
|
|
|
|
||||||||
Consolidated
|
1,426
|
|
|
1,604
|
|
|
3,562
|
|
|
3,284
|
|
||||
Our share of depreciation and amortization from unconsolidated joint ventures
|
1,013
|
|
|
1,119
|
|
|
3,147
|
|
|
3,172
|
|
||||
Total depreciation and amortization
|
2,439
|
|
|
2,723
|
|
|
6,709
|
|
|
6,456
|
|
||||
EBITDA
|
2,907
|
|
|
7,727
|
|
|
9,106
|
|
|
12,525
|
|
||||
Stock compensation expense
|
338
|
|
|
825
|
|
|
1,930
|
|
|
2,601
|
|
||||
Adjusted EBITDA
|
$
|
3,245
|
|
|
$
|
8,552
|
|
|
$
|
11,036
|
|
|
$
|
15,126
|
|
($ in thousands)
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
Net operating income
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Pastoria Energy Facility
|
$
|
1,088
|
|
|
$
|
1,230
|
|
|
$
|
3,487
|
|
|
$
|
3,131
|
|
TRCC
|
375
|
|
|
355
|
|
|
1,071
|
|
|
1,070
|
|
||||
Communication leases
|
223
|
|
|
215
|
|
|
683
|
|
|
685
|
|
||||
Other commercial leases
|
159
|
|
|
175
|
|
|
461
|
|
|
519
|
|
||||
Total Commercial/Industrial net operating income
|
$
|
1,845
|
|
|
$
|
1,975
|
|
|
$
|
5,702
|
|
|
$
|
5,405
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Commercial/Industrial operating income
|
$
|
652
|
|
|
$
|
767
|
|
|
$
|
3,688
|
|
|
$
|
2,403
|
|
Plus: Commercial/Industrial depreciation and amortization
|
144
|
|
|
127
|
|
|
432
|
|
|
458
|
|
||||
Plus: General, administrative, cost of sales and other expenses
|
1,564
|
|
|
1,471
|
|
|
7,460
|
|
|
3,714
|
|
||||
Less: Other revenues including land sales
|
(515
|
)
|
|
(390
|
)
|
|
(5,878
|
)
|
|
(1,170
|
)
|
||||
Total Commercial/Industrial net operating income
|
$
|
1,845
|
|
|
$
|
1,975
|
|
|
$
|
5,702
|
|
|
$
|
5,405
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income of unconsolidated joint ventures
|
$
|
3,653
|
|
|
$
|
2,479
|
|
|
$
|
8,187
|
|
|
$
|
3,548
|
|
Interest expense of unconsolidated joint ventures
|
1,384
|
|
|
1,393
|
|
|
4,251
|
|
|
3,445
|
|
||||
Operating income of unconsolidated joint ventures
|
5,037
|
|
|
3,872
|
|
|
12,438
|
|
|
6,993
|
|
||||
Depreciation and amortization of unconsolidated joint ventures
|
1,901
|
|
|
2,110
|
|
|
5,920
|
|
|
5,954
|
|
||||
Net operating income of unconsolidated joint ventures
|
$
|
6,938
|
|
|
$
|
5,982
|
|
|
$
|
18,358
|
|
|
$
|
12,947
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
|
Total
|
|
Fair Value
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
$14,641
|
|
$31,830
|
|
$898
|
|
$—
|
|
$—
|
|
$—
|
|
$47,369
|
|
$47,423
|
Weighted average interest rate
|
2.09%
|
|
2.15%
|
|
2.06%
|
|
—%
|
|
—%
|
|
—%
|
|
2.13%
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revolving line of credit
|
$5,000
|
|
$—
|
|
$—
|
|
$—
|
|
$—
|
|
$—
|
|
$5,000
|
|
$5,000
|
Weighted average interest rate
|
3.55%
|
|
—%
|
|
—%
|
|
—%
|
|
—%
|
|
—%
|
|
3.55%
|
|
|
Long-term debt ($4.75M note)
|
$73
|
|
$302
|
|
$315
|
|
$328
|
|
$343
|
|
$1,841
|
|
$3,202
|
|
$3,202
|
Weighted average interest rate
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
|
Long-term debt (Amended Term Loan)
|
$949
|
|
$3,881
|
|
$4,051
|
|
$4,221
|
|
$4,429
|
|
$42,186
|
|
$59,717
|
|
$59,717
|
Weighted average interest rate
|
4.16%
|
|
4.16%
|
|
4.16%
|
|
4.16%
|
|
4.16%
|
|
4.16%
|
|
4.16%
|
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
|
Total
|
|
Fair Value
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities
|
$43,627
|
|
$20,111
|
|
$400
|
|
$—
|
|
$—
|
|
$—
|
|
$64,138
|
|
$63,749
|
Weighted average interest rate
|
2.02%
|
|
2.09%
|
|
2.51%
|
|
—%
|
|
—%
|
|
—%
|
|
2.04%
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt ($4.75M note)
|
$289
|
|
$302
|
|
$315
|
|
$328
|
|
$343
|
|
$1,841
|
|
$3,418
|
|
$3,418
|
Weighted average interest rate
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
4.25%
|
|
|
Long-term debt ($70.0M note)
|
$3,715
|
|
$3,881
|
|
$4,051
|
|
$4,221
|
|
$4,429
|
|
$42,186
|
|
$62,483
|
|
$62,483
|
Weighted average interest rate
|
4.11%
|
|
4.11%
|
|
4.11%
|
|
4.11%
|
|
4.11%
|
|
4.11%
|
|
4.11%
|
|
|
Long-term debt (other)
|
$14
|
|
$—
|
|
$—
|
|
$—
|
|
$—
|
|
$—
|
|
$14
|
|
$14
|
Weighted average interest rate
|
3.35%
|
|
—%
|
|
—%
|
|
—%
|
|
—%
|
|
—%
|
|
3.35%
|
|
|
(a)
|
Evaluation of Disclosure Controls and Procedures
|
(b)
|
Changes in Internal Control Over Financial Reporting
|
10.9(1)
|
|
|
|
FN 7
|
|
10.10
|
|
|
|
FN 9
|
|
10.10(1)
|
|
|
|
FN 7
|
|
10.12
|
|
|
|
FN 10
|
|
10.15
|
|
|
|
FN 11
|
|
10.16
|
|
|
|
FN 12
|
|
10.17
|
|
|
|
FN 13
|
|
10.18
|
|
|
|
FN 13
|
|
10.19
|
|
|
|
FN 13
|
|
10.23
|
|
|
|
FN 14
|
|
10.24
|
|
|
|
FN 15
|
|
10.25
|
|
|
|
FN 16
|
|
10.26
|
|
|
|
FN 17
|
|
10.27
|
|
|
|
FN 18
|
|
10.28
|
|
|
|
FN 19
|
|
10.29
|
|
|
|
FN 20
|
|
10.30
|
|
|
|
FN 21
|
|
10.31
|
|
|
|
FN 22
|
|
10.32
|
|
|
|
FN 22
|
|
10.33
|
|
|
|
FN 22
|
|
10.34
|
|
|
|
FN 23
|
|
10.35
|
|
|
|
FN 24
|
|
10.37
|
|
|
|
FN 26
|
|
10.38
|
|
|
|
FN 27
|
|
10.39
|
|
|
|
FN 28
|
|
10.40
|
|
|
|
FN 29
|
|
10.41
|
|
|
|
FN 30
|
|
10.42
|
|
|
|
FN 31
|
|
10.43
|
|
|
|
FN 32
|
FN 1
|
|
This document, filed with the Securities and Exchange Commission in Washington D.C. (file number 1-7183) under Item 14 to our Annual Report on Form 10-K for year ended December 31, 1987, is incorporated herein by reference. This Exhibit was not filed with the Securities and Exchange Commission in an electronic format.
|
FN 2
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 99.1 to our Current Report on Form 8-K filed on September 20, 2017, is incorporated herein by reference.
|
FN 5
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 4.1 to our Current Report on Form 8-K filed on December 20, 2005, is incorporated herein by reference.
|
FN 6
|
|
This document, filed with the Securities and Exchange Commission in Washington D.C. (file number 1-7183) under Item 14 to our Annual Report on Form 10-K for the year ended December 31, 1994, is incorporated herein by reference. This Exhibit was not filed with the Securities and Exchange Commission in an electronic format.
|
FN 7
|
|
This document, filed with the Securities and Exchange Commission in Washington D.C. (file number 1-7183) under Item 14 to our Annual Report on Form 10-K for the year ended December 31, 1997, is incorporated herein by reference.
|
FN 8
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.9 to our Annual Report on Form 10-K for the year ended December 31, 2008, is incorporated herein by reference.
|
FN 9
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.10 to our Annual Report on Form 10-K for the year ended December 31, 2008, is incorporated herein by reference
|
FN 10
|
|
This document filed with the Securities and Exchange Commission in Washington D.C. (file number 1-7183) as Exhibit 10.16 to our Annual Report on Form 10-K for the year ended December 31, 2001, is incorporated herein by reference.
|
FN 11
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 4.1 to our Current Report on Form 8-K filed on May 7, 2004, is incorporated herein by reference.
|
FN 12
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 4.2 to our Current Report on Form 8-K filed on May 7, 2004, is incorporated herein by reference.
|
FN 13
|
|
This document, filed with the Securities and Exchange Commission in Washington D.C. (file number 1-7183) as Exhibits 10.21-10.23 to our Annual Report on Form 10-K for the year ended December 31, 2004, is incorporated herein by reference.
|
FN 14
|
|
This document, filed with the Securities and Exchange Commission in Washington D.C. (file number 1-7183) as Exhibit 10.24 to our Current Report on Form 8-K filed on May 24, 2006, is incorporated herein by reference.
|
FN 15
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.28 to our Current Report on Form 8-K filed on June 23, 2008, is incorporated herein by reference.
|
FN 16
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.25 to our Quarterly Report on Form 10-Q for the period ended June 30, 2009, is incorporated herein by reference.
|
FN 18
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.27 to our Current Report on Form 8-K filed on June 4, 2013, is incorporated herein by reference.
|
FN 19
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.1 to our Current Report on Form 8-K filed on August 8, 2013, is incorporated herein by reference.
|
FN 20
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.29 to our Amended Annual Report on Form 10-K/A for the year ended December 31, 2013, is incorporated herein by reference.
|
FN 21
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.30 to our Current Report on Form 8-K filed on July 16, 2014, is incorporated herein by reference.
|
FN 22
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibits 10.31-10.33 to our Current Report on Form 8-K filed on October 17, 2014, is incorporated herein by reference.
|
FN 23
|
|
This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.34 to our Annual Report on Form 10-K for the year ended December 31, 2014, is incorporated herein by reference.
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FN 24
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.35 to our Quarterly Report on Form 10-Q for the period ended June 30, 2015, is incorporated herein by reference.
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FN 26
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.37 to our Quarterly Report on Form 10-Q for the period ended June 30, 2016, is incorporated herein by reference.
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FN 27
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.38 to our Quarterly Report on Form 10-Q for the period ended September 30, 2016, is incorporated herein by reference.
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FN 28
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.39 to our Annual Report on Form 10-K for the year ended December 31, 2016, is incorporated herein by reference.
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FN 29
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.40 to our Annual Report on Form 10-K for the year ended December 31, 2016, is incorporated herein by reference.
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FN 30
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.41 to our Annual Report on Form 10-K for the year ended December 31, 2016, is incorporated herein by reference.
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FN 31
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.42 to our Quarterly Report on Form 10-Q for the period ended September 30, 2018, is incorporated herein by reference.
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FN 32
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.43 to our Annual Report on Form 10-K for the year ended December 31, 2018, is incorporated herein by reference.
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FN 33
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This document, filed with the Securities and Exchange Commission in Washington, D.C. (file number 1-7183) as Exhibit 10.44 to our Annual Report on Form 10-K for the year ended December 31, 2018, is incorporated herein by reference.
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TEJON RANCH CO.
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November 6, 2019
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/s/ Gregory S. Bielli
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Gregory S. Bielli
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President and Chief Executive Officer
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(Principal Executive Officer)
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November 6, 2019
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/s/ Robert D. Velasquez
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Robert D. Velasquez
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Senior Vice President of Finance and Chief Financial Officer
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(Principal Financial and Accounting Officer)
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1.
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I have reviewed this quarterly report on Form 10-Q of Tejon Ranch Co.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Dated:
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November 6, 2019
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/s/ Gregory S. Bielli
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Gregory S. Bielli
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President and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of Tejon Ranch Co.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Dated:
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November 6, 2019
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/s/ Robert D. Velasquez
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Robert D. Velasquez
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Senior Vice President of Finance and Chief Financial Officer
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•
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The Quarterly Report of the Company on Form 10-Q for the period ended September 30, 2019 fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
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•
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The information contained in such report fairly presents, in all material respects, the financial condition and results of operation of the Company.
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Dated:
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November 6, 2019
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/s/ Gregory S. Bielli
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Gregory S. Bielli
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President and Chief Executive Officer
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/s/ Robert D. Velasquez
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Robert D. Velasquez
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Senior Vice President of Finance and Chief Financial Officer
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