The St. Joe Company’s (NYSE: JOE) (the “Company”) net income for
the fourth quarter of 2020 increased approximately 128% to $19.8
million, or $0.34 per share, compared with net income of $8.7
million, or $0.15 per share, for the same period in 2019. Total
revenue increased 50% to $63.9 million for the fourth quarter of
2020 as compared to $42.6 million for the fourth quarter of 2019.
The increase was driven by a 65% increase in real estate revenue, a
38% increase in hospitality revenue and a 7% increase in leasing
revenue.
For the full year ended December 31, 2020, the Company’s net
income increased approximately 69% to $45.2 million, or $0.77 per
share, compared to net income of $26.8 million, or $0.45 per share,
for the full year ended December 31, 2019. Revenue for the full
year 2020 increased approximately 26% to $160.5 million as compared
to $127.1 million in 2019.
In 2020, the Company invested $162.2 million in capital
expenditures. In addition, the Company repurchased $8.8 million of
common stock and paid $4.1 million in cash dividends. As of
December 31, 2020, the Company had $157.5 million in cash, cash
equivalents and investments.
On February 24, 2021, the Board of Directors declared a cash
dividend of $0.08 per share on its common stock, a 14% increase
from the December 2020 dividend payment, payable on March 30, 2021
to shareholders of record at the close of business on March 8,
2021.
Jorge Gonzalez, the Company’s President and Chief Executive
Officer, said, “We sold 206 homesites in the fourth quarter of 2020
compared to 103 homesites in the fourth quarter of 2019, an
increase of 100%. We sold 509 homesites for the full year of 2020
as compared to 379 homesites in 2019, with higher prices and higher
margins. The Clubs by JOE membership grew by 115 in the fourth
quarter and 289 for the full year of 2020, bringing the total to
1,563 members as of December 31, 2020. Club membership sales in
2020 were the highest in any single year in the Company’s history.
In the fourth quarter, we executed eight new commercial leases.
This brings the 2020 total of new commercial leases to 31, the
highest number of new leases in over a decade. As of December 31,
2020, we had 1,269 residential homesites under contract with ten
different builders and plans for additional residential communities
in Bay County.”
Mr. Gonzalez continued, “The opening of the Latitude
Margaritaville Watersound community is on target for April 2021
with site development on the initial 629 homesites underway while
the 13 models and the sales center are nearing completion. We have
an additional 739 new apartment units under construction, together
with the 378 completed units, bringing the total apartment unit
count to 1,117. Our hospitality segment is building upon the growth
we are experiencing by adding an additional 689 new hotel rooms
which are currently under construction. In addition, we are
expanding other operational assets such as The Clubs by JOE
amenities complex at Watersound Camp Creek.”
Mr. Gonzalez concluded, “We finished 2020 with strong revenue
growth across our operating segments. We are achieving scale
efficiencies. Accelerating 2020 successes into 2021 and beyond is
our top priority. As more people are discovering the high quality
of life in Northwest Florida and are choosing to live and vacation
here, we believe the combination of our strong brand, land
holdings, entitlements and operational muscle position us for
sustainable growth not easily available to others. We believe that
we have only started scratching the surface.”
Real Estate Revenue
Real estate revenue increased by approximately 65% to $45.8
million in the fourth quarter of 2020 as compared to $27.8 million
in the fourth quarter of 2019. The Company sold 206 homesites at an
average price of approximately $189,000 with gross margins of 67%
in the fourth quarter of 2020 as compared to 103 homesites at an
average price of $96,000 with gross margins of 54% in the fourth
quarter of 2019. The increase in the average sales price and gross
margins was due to mix of sales in different communities driven by
initial sales in the WaterColor Park District and Watersound Camp
Creek communities. In addition to the homesite sales, for the
fourth quarter of 2020, the Company had commercial and rural land
sales totaling $4.4 million as compared to $14.9 million for the
fourth quarter of 2019. The 2019 revenue included sales of
non-strategic land, primarily in Leon County, Florida generating
approximately $9.9 million of revenue.
For the full year 2020, the Company sold a total of 509
homesites at an average price of approximately $124,000 with gross
margins of approximately 60% as compared to 379 homesites for the
full year 2019 with an average price of $87,000 with gross margins
of approximately 50%. In addition to the homesite sales, for the
full year of 2020, the Company had commercial, rural and unimproved
residential land sales totaling $13.4 million as compared to such
commercial and rural land sales totaling $19.5 million for the full
year of 2019.
As of December 31, 2020, the Company had 1,269 residential
homesites under contract, which are expected to result in revenue
of approximately $90,000 per base homesite price, excluding any
applicable true-up, for a total of $115.0 million over the next
several years as compared to 930 residential homesites under
contract for a total of $84.3 million as of December 31, 2019. The
trajectory in homesite sales over the past five years has been as
follows:
2016:
106
2017:
174
2018:
202
2019:
379
2020:
509
Hospitality Revenue
Hospitality revenue increased by approximately 38% to $12.6
million in the fourth quarter of 2020 as compared to $9.1 million
in the fourth quarter of 2019. Hospitality revenue continues to
benefit from the growth of The Clubs by JOE membership program and
increased visitor activity. The table below details hospitality
revenue by month for the fourth quarter of 2020 and 2019.
Q4 2020
Q4 2019
Percentage Change
Revenue:
October
$5.3
$3.6
47.2%
November
3.9
3.0
30.0%
December
3.4
2.5
36.0%
Total Quarter
$12.6
$9.1
38.5%
As of December 31, 2020, the Company had under construction a
143-room Hilton Garden Inn hotel located near the Northwest Florida
Beaches International Airport, a 75-room boutique inn and new The
Clubs by JOE amenities at Watersound Camp Creek and a 131-room
Homewood Suites hotel near the new Panama City Beach Sports
Complex. In addition, the Company, with separate joint venture
partners, has under construction a 255-room Embassy Suites hotel in
the Pier Park area of Panama City Beach and an 85-room boutique
hotel in Seagrove Beach. In December 2020, the Company announced
the planned Hotel Indigo in Panama City’s downtown waterfront
district. The Company intends to operate these new hotels. In
addition, the Bay Point Marina and Port St. Joe Marina are in
reconstruction and additional new marinas are in the planning
process.
Leasing Revenue
Leasing revenue from commercial, retail, multi-family and other
properties increased by approximately 7% for the fourth quarter of
2020 compared to the same period in 2019. For the full year 2020,
leasing revenue increased approximately 20% as compared to the full
year of 2019. This change for the fourth quarter and the full year
2020 was due to increased apartment leasing revenue, increased
square feet under lease as well as higher lease rates. COVID-19 had
minimal impact on the commercial segment. In the fourth quarter of
2020, the Company did not provide any rent abatements or rent
deferrals and collected $0.1 million of the total $0.4 million of
deferrals from the second and third quarter of 2020.
In the fourth quarter of 2020, the Company executed eight new
commercial leases bringing the full year total of new commercial
leases to 31. As of December 31, 2020, the Company’s rentable space
consisted of approximately 908,000 square feet of which
approximately 774,000 was leased, compared to approximately 882,000
square feet as of December 31, 2019 of which approximately 758,000
was leased. In the first quarter of 2020, the Company sold the
SouthWood Town Center, which consisted of 34,230 rentable square
feet. The decrease in gross square feet under lease resulting from
the sale of the SouthWood Town Center was offset by newly completed
rentable space.
As of December 31, 2020, the Company, through consolidated joint
ventures, had 378 completed apartment units. Of this amount, 240
apartment units were in Pier Park Crossings, which were 99% leased.
The construction of Phase II of the Pier Park Crossings apartment
community was completed in December of 2020 adding 120 additional
apartment units. In addition, the Watersound Origins Crossings
apartment community, which will consist of 217 apartment units,
completed the initial buildings totaling 18 apartment units.
The Company, individually or through consolidated and
unconsolidated joint ventures, has under construction three
apartment communities totaling 739 additional units. In addition,
construction on the 107-unit senior living project was completed in
the fourth quarter of 2020 and the operational license was issued
in January 2021. The Company also has a multi-tenant commercial
building and a self-storage facility under construction for a
combined total of approximately 91,000 square feet of rentable
space. The Company has executed leases on approximately 55,000
square feet of additional commercial space which are expected to
begin construction in 2021.
Timber Revenue
Timber revenue decreased by approximately 38% to $0.8 million
for the fourth quarter of 2020 as compared to $1.3 million in the
fourth quarter of 2019. For the full year 2020, timber revenue
increased approximately 61% to $6.3 million compared to the full
year 2019 of $3.9 million. Revenue increased for the full year of
2020 as the industry continued to recover from the residual effects
of Hurricane Michael.
Other Operating and Corporate Expenses
Other operating and corporate expenses were at $5.9 million for
the fourth quarter of 2020 as compared to $5.3 million for the
fourth quarter of 2019. The increase was primarily related to the
increase in professional fees for legal, accounting and tax
services related to the growth of operations. The Company continues
to manage operating costs to maintain an efficient structure.
Liquidity
The Company maintained cash, cash equivalents and investments of
$157.5 million as of December 31, 2020 compared to $155.1 million
at the beginning of the quarter, an increase of $2.4 million. Of
the $157.5 million, $127.0 million was invested in U.S. Treasury
Bills and $11.0 million was invested in U.S. Treasury Money Market
Funds. During the fourth quarter of 2020, the Company incurred a
total of $42.5 million in capital expenditures and paid $4.1
million in cash dividends.
Financial data schedules in this press release include
consolidated results, summary balance sheets, debt and other
operating and corporate expenses for the fourth quarter and full
year 2020 and 2019, respectively.
FINANCIAL DATA
Consolidated Results
($ in millions except share
and per share amounts)
(Unaudited) Quarter Ended
December
31,
Year
Ended
December
31,
2020
2019
2020
2019
Revenue
Real estate revenue
$45.8
$27.8
$87.6
$61.5
Hospitality revenue
12.6
9.1
47.8
46.1
Leasing revenue
4.7
4.4
18.8
15.6
Timber revenue
0.8
1.3
6.3
3.9
Total revenue
63.9
42.6
160.5
127.1
Expenses
Cost of real estate revenue
17.4
9.6
35.8
24.3
Cost of hospitality revenue
8.7
8.1
35.2
34.5
Cost of leasing revenue
2.0
1.2
5.9
4.7
Cost of timber revenue
0.2
0.1
0.8
0.6
Other operating and corporate expenses
5.9
5.3
22.9
21.4
Depreciation, depletion and
amortization
3.4
3.1
12.8
10.3
Total expenses
37.6
27.4
113.4
95.8
Operating income
26.3
15.2
47.1
31.3
Investment income (loss), net
2.1
(0.3)
5.0
10.7
Interest expense
(3.4)
(3.2)
(13.6)
(12.3)
Gain on land contribution to equity method
investment
0.3
--
20.0
2.3
Other income (expense), net
0.7
(0.7)
1.3
4.2
Income before equity in loss from
unconsolidated affiliates and income taxes
26.0
11.0
59.8
36.2
Equity in loss from unconsolidated
affiliates
(0.4)
(0.1)
(0.6)
(0.1)
Income tax expense
(5.8)
(2.3)
(13.7)
(9.4)
Net income
19.8
8.6
45.5
26.7
Net loss (income) attributable to
non-controlling interest
--
0.1
(0.3)
0.1
Net income attributable to the Company
$19.8
$8.7
$45.2
$26.8
Net income per share attributable to the
Company
$0.34
$0.15
$0.77
$0.45
Weighted average shares outstanding
58,882,549
59,422,455
59,009,865
59,994,527
Summary Balance Sheets
($ in millions)
December
31, 2020
December
31, 2019
Assets
Investment in real estate, net
$551.7
$430.8
Investment in unconsolidated joint
ventures
38.0
5.1
Cash and cash equivalents
106.8
185.7
Investments – debt securities
48.1
0.1
Investments – equity securities
2.6
9.7
Other assets
63.2
52.0
Property and equipment, net
20.8
19.0
Investments held by special purpose
entities
206.1
206.8
Total assets
$1,037.3
$909.2
Liabilities and Equity
Debt, net
$158.9
$92.5
Other liabilities
72.0
57.2
Deferred tax liabilities, net
60.9
52.8
Senior Notes held by special purpose
entity
177.3
177.0
Total liabilities
469.1
379.5
Total equity
568.2
529.7
Total liabilities and equity
$1,037.3
$909.2
Debt Schedule
($ in millions – Net of
issuance costs)
December
31, 2020
December
31, 2019
Pier Park North joint venture
$44.3
$45.1
Pier Park Crossings joint venture
35.0
33.5
Watersound Origins Crossings
joint venture
26.8
2.4
Watercrest joint venture
17.8
--
Pier Park Crossings II joint
venture
15.7
--
Community Development
District
6.3
7.0
Beckrich Building III
5.4
--
Airport Hotel
3.4
--
Beach Homes
1.5
1.6
Pier Park outparcel
1.4
1.5
WaterColor Crossings
1.3
1.4
Total debt, net
$158.9
$92.5
Other Operating and Corporate
Expenses
($ in millions)
(Unaudited) Quarter Ended
December
31,
Year
Ended
December
31,
2020
2019
2020
2019
Employee costs
$2.1
$2.1
$8.4
$7.8
401(k) contribution
--
--
1.2
1.1
Non-cash stock compensation costs
--
--
--
0.1
Property taxes and insurance
1.6
1.4
5.3
5.0
Professional fees
1.5
1.0
4.7
4.0
Marketing and owner association costs
0.3
0.3
1.2
1.2
Occupancy, repairs and maintenance
0.1
0.2
0.7
0.8
Other
0.3
0.3
1.4
1.4
Total other operating and corporate
expense
$5.9
$5.3
$22.9
$21.4
Additional Information and Where to
Find It
Additional information with respect to the Company’s results for
the fourth quarter and full year 2020 will be available in a Form
10-K that will be filed with the Securities and Exchange Commission
(“SEC”), and can be found at the SEC’s website www.sec.gov.
Important Notice Regarding
Forward-Looking Statements
Certain statements contained in this press release, as well as
other information provided from time to time by the Company or its
employees, may contain forward-looking statements that involve
risks and uncertainties that could cause actual results to differ
materially from those in the forward-looking statements. You can
identify forward-looking statements by the fact that they do not
relate strictly to historical or current facts. These statements
may include words such as “guidance,” “anticipate,” “estimate,”
“expect,” “forecast,” “project,” “plan,” “intend,” “believe,”
“confident,” “may,” “should,” “can have,” “likely,” “future” and
other words and terms of similar meaning in connection with any
discussion of the timing or nature of future operating or financial
performance or other events. Examples of forward-looking statements
in this press release include statements regarding our growth
prospects; expansion of operational assets; our continued cost
discipline to maintain an efficient cost structure; our capital
allocation initiatives, including the timing and amount of
dividends; and timing of current developments and new projects in
2021. Any such forward-looking statements are not guarantees of
performance or results, and involve risks, uncertainties (some of
which are beyond the Company’s control) and assumptions.
The Company wishes to caution readers that, although we believe
any forward-looking statements are based on reasonable assumptions,
certain important factors may have affected and could in the future
affect the Company’s actual financial results and could cause the
Company’s actual financial results for subsequent periods to differ
materially from those expressed in any forward-looking statement
made by or on behalf of the Company, including (1) the potential
impacts of the ongoing COVID-19 pandemic; (2) any changes in our
strategic objectives or our ability to successfully implement such
strategic objectives; (3) our ability to successfully execute our
newer business ventures, including expansion of our portfolio of
income producing commercial and multi-family properties, senior
living communities and hotels, some or all of which may be
negatively impacted by the COVID-19 pandemic; (4) any potential
negative impact of our longer-term property development strategy,
including losses and negative cash flows for an extended period of
time if we continue with the self-development of granted
entitlements; (5) significant decreases in the market value of our
investments in securities or any other investments; (6) our
dependence on strong migration and population expansion in our
regions of development, particularly Northwest Florida; (7) our
ability to accurately predict market demand for the range of
potential residential and commercial uses of our real estate; (8)
volatility in the consistency and pace of our residential real
estate sales; (9) any downturns in real estate markets in Florida
or across the nation; (10) any reduction in the supply of mortgage
loans or tightening of credit markets; (11) our ability to fully
recover from natural disasters and severe weather conditions,
including the recovery of insurance claims for losses related to
Hurricane Michael; (12) our dependence on the real estate industry
and the cyclical nature of our real estate operations; (13) our
ability to retain commercial tenants, particularly in light of the
COVID-19 pandemic; (14) our ability to successfully and timely
obtain land use entitlements and construction financing, maintain
compliance with state law requirements and address issues that
arise in connection with the use and development of our land,
including the permits required for mixed-use and active adult
communities; (15) changes in laws, regulations or the regulatory
environment affecting the development of real estate; (16) our
ability to effectively deploy and invest our assets, including our
available-for-sale securities; (17) our ability to effectively
manage our real estate assets, as well as the ability for us or our
joint venture partners to effectively manage the day-to-day
activities of our joint venture projects; (18) increases in
operating costs, including costs related to real estate taxes,
owner association fees, construction materials, labor and
insurance, and our ability to manage our cost structure; (19) our
ability to mutually agree to joint venture structures with our
potential joint venture partners and to successfully enter into
previously announced potential joint ventures; (20) potential
limitations on our ability to declare dividends at our expected
rates, or at all; and (21) the other cautionary statements and risk
factor disclosures contained in the Company’s Securities and
Exchange Commission filings including the Company’s Annual Report
on Form 10-K for the year ended December 31, 2019, the Company’s
Quarterly Reports on Form 10-Q for the quarters ended March 31,
2020, June 30, 2020 and September 30, 2020, and our other reports
filed with the SEC, which can be found at the SEC’s website at
www.sec.gov. The discussion of these risks is specifically
incorporated by reference into this press release.
Any forward-looking statement made by us in this press release
speaks only as of the date on which it is made. We undertake no
obligation to update any forward-looking statement, whether as a
result of new information, future developments or otherwise, except
as may be required by law.
About The St. Joe
Company
The St. Joe Company is a real estate development, asset
management and operating company with real estate assets and
operations in Northwest Florida. The Company intends to use
existing assets for residential, hospitality and commercial
ventures. St. Joe has significant residential and commercial
land-use entitlements. The Company actively seeks higher and better
uses for its real estate assets through a range of development
activities. More information about the Company can be found on its
website at www.joe.com. On a regular basis, the Company releases a
video showing progress on projects in development or under
construction. See https://www.joe.com/video-gallery for more
information.
© 2021, The St. Joe Company. “St. Joe®”, “JOE®”, the “Taking
Flight” Design®, “St. Joe (and Taking Flight Design)®”, and other
amenity names used herein are the registered service marks of The
St. Joe Company or its affiliates or others.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210224006080/en/
St. Joe Investor Relations Contact: Marek Bakun Chief Financial
Officer 1-866-417-7132 Marek.Bakun@Joe.Com
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