Tejon Ranch Co. Announces Second Quarter 2025 Financial Results

TEJON RANCH, Calif., Aug. 07, 2025 (GLOBE NEWSWIRE) -- Tejon Ranch Co., or the Company, (NYSE:TRC), a diversified real estate development and agribusiness company, today announced financial results for the three and six-months ended June 30, 2025. “We saw positive momentum this quarter in our adjusted EBITDA and farming revenues, reflecting our focus on disciplined execution and highlighting the strength of our diversified platform,” said Matthew H. Walker, President and Chief Executive Officer. “While our GAAP results reflect the costs of the proxy contest, those were one-time events. Our focus remains on the long-term fundamentals and driving incremental earnings growth. At the Tejon Ranch Commerce Center, our core commercial and industrial assets continue to perform well. Terra Vista at Tejon has officially opened and is leasing in line with our targets. We are encouraged by our performance and remain committed to building shareholder value.” “Our second quarter results were impacted by non-recurring expenses and the timing of revenues in our farming and real estate - commercial/industrial segments. That said, we are encouraged by the strong response to our first multifamily offering and the continued high occupancy rates across our industrial and retail portfolios,” said Robert D. Velasquez, Chief Financial Officer. “We remain committed to disciplined expense management and are executing targeted initiatives to drive operational efficiency and enhance free cash flow over time.” Please also visit ir.tejonranch.com this afternoon for a video update from Matthew Walker, our President & CEO. Additionally, we’re excited to announce that we’ll be hosting our first Investor Day since 2018 the morning of November 14th at the New York Stock Exchange. Additional details and registration information will be forthcoming. Commercial/Industrial Real Estate Update Leasing and occupancy updates as of June 30, 2025: TRCC industrial portfolio, through the Company's joint venture partnerships, consists of 2.8 million square feet of gross leasable area (GLA) and is 100% leased.TRCC commercial/retail portfolio, wholly owned and through joint venture partnerships, consists of 620,907 square feet of GLA and is 95% occupied.In total, TRCC comprises 7.1 million square feet of GLA.Outlets at Tejon maintained strong performance with 91% occupancy as of June 30, 2025. In early May, Terra Vista at Tejon Phase 1, the Company's first multifamily residential development located within TRCC, welcomed its initial residents. Phase 1 includes 228 of the planned 495 residential units. Initial leasing activity has been encouraging. As of June 30, 2025, 49% of the 84 delivered units were leased.Nestlé USA is nearing completion on the construction of a new, state-of-the-art distribution facility on the east side of TRCC. The project, led by Nestlé, will span more than 700,000 square feet. Second Quarter 2025 Financial Results GAAP net loss attributable to common stockholders for the second quarter of 2025 was $1.7 million, or net loss per share attributable to common stockholders, basic and diluted, of $0.06. In the second quarter of 2024, the Company reported net income attributable to common stockholders of $1.0 million, or net income per share attributable to common stockholders, basic and diluted, of $0.04. The $2.7 million year-over-year swing was primarily driven by the $2.3 million in consulting fees related to the contested board election and proxy defense. Revenues and other income, including equity in earnings of unconsolidated joint ventures, for the second quarter of 2025 were $11.1 million, compared with $9.0 million for the second quarter of 2024. The primary driver of this increase was the real estate commercial/industrial segment, which generated $2.6 million more in revenue compared to the prior period. This increase was due to the recognition of land sale revenue following the Company's completion of the performance obligation related to a land sale transaction that occurred in 2022. The increase was partially offset by the $0.5 million decrease in mineral resources segment due to decrease in water sales revenue resulted from higher than expected rainfall, which reduced demand. Adjusted EBITDA, a non-GAAP measure, was $5.7 million for the second quarter ended June 30, 2025, compared with $5.1 million for the same period in 2024. Tejon Ranch Co. provides Adjusted EBITDA, a non-GAAP financial measure, because management believes it offers additional information for monitoring the Company's cash flow performance. A table providing a reconciliation of Adjusted EBITDA to its most comparable GAAP measure, as well as an explanation of, and important disclosures about, this non-GAAP measure, is included in the tables at the end of this press release. Year-to-Date Financial Results Net loss attributable to common stockholders for the first six months of 2025 was $3.2 million, or net loss per share attributed to common stockholders, basic and diluted, of $0.12, compared with net income attributable to common stockholders of $43.0 thousand, or net income per share attributed to common stockholders, basic and diluted, of $0.00, for the first six months of 2024. The primary factor driving this change was the increase in operating losses within the corporate segment, mainly due to the more than $3.0 million of additional expense incurred related professional and consulting fees incurred during the contested board election and proxy defense during the six months ended June 30, 2025. Revenues and other income, for the first six months of 2025, including equity in earnings of unconsolidated joint ventures, totaled $20.7 million, compared with $18.6 million for the first six months of 2024. Factors impacting the year-to-date results include: Real estate commercial/industrial segment experienced an increase in revenue for the first six months of 2025. Revenues for this segment were $7.9 million, an increase of $2.4 million, or 43%, from $5.5 million for the first six months of 2024. The primary driver of this increase was the recognition in land sales revenue, following the Company's fulfillment of the performance obligation related to a land sale that occurred in 2022.Farming segment revenues were $2.2 million for the first six months of 2025, an increase of $1.2 million, or 115%, from $1.0 million for the first six months of 2024. Almond sales, the biggest contributor to this increase, increased by $1.2 million due to higher units sold in current year. The Company sold 727,000 and 381,000 pounds of almonds during the six months ended June 30, 2025 and 2024, respectively.The increase in revenue was partially offset by a decrease in equity in earnings of unconsolidated joint ventures. The equity in earnings were $3.7 million for the six months ended June 30, 2025, a decrease of $0.6 million, or 13%, compared to $4.3 million during the same period in 2024. The decrease was primarily due to a reduction in equity in earnings from the TA/Petro joint venture, which declined by approximately $595,000. The decline was driven by a 7.6% reduction in nonfuel gross margins and a 10.9% increase in operating expense compared to the same period in 2024.Additionally, other income decreased by $682,000, largely due to reduced investment earnings stemming from a lower balance of marketable securities. Adjusted EBITDA, a non-GAAP measure, was $8.6 million for the six months ended June 30, 2025, compared with $7.3 million for the same period in 2024. Tejon Ranch Co. provides Adjusted EBITDA, a non-GAAP financial measure, because management believes it offers additional information for monitoring the Company's cash flow performance. A table providing a reconciliation of Adjusted EBITDA to its most comparable GAAP measure, as well as an explanation of, and important disclosures about, this non-GAAP measure, is included in the tables at the end of this press release. Liquidity and Capital Resources As of June 30, 2025, total capitalization, including pro rata share (PRS) of unconsolidated joint venture debt, was approximately $648.4 million, consisting of an equity market capitalization of $455.9 million and $192.5 million of debt, and our debt to total capitalization was 29.7%. As of June 30, 2025, the Company had cash and securities totaling approximately $20.1 million and $78.1 million available on its line of credit, for total liquidity of $98.1 million. The ratio of total debt including pro rata share of unconsolidated joint venture debt, net of cash and securities including pro rata share of unconsolidated joint venture cash, of $160.5 million, to trailing twelve months adjusted EBITDA of $24.7 million was 6.5x using non-GAAP measures. 2025 Outlook: The Company will continue to strategically pursue commercial/industrial development, multi-family development, leasing, sales, and investment activities across TRCC, including its joint ventures developments. The Company will also continue to make measured capital investment to advance its residential projects, Mountain Village at Tejon Ranch, Centennial at Tejon Ranch and Grapevine at Tejon Ranch, through disciplined, strategic investment, with a focus on critical entitlements, planning milestones, and value-enhancing activities. California is one of the most highly regulated states in which to engage in real estate development and, as such, natural delays, including those resulting from litigation, can be reasonably anticipated. Accordingly, throughout the next few years, the Company expects net income to fluctuate from year-to-year based on the above-mentioned activity, along with commodity prices, production within its farming and mineral resources segments, and the timing of land sales and leasing of land within its industrial developments. Water sales opportunities each year are impacted by the total precipitation and snowpack runoff in Northern California from winter storms along with State Water Project, or SWP, allocations. This year marks the third consecutive year of above average snowpack levels. The current SWP allocation is at 50% of contract amounts, suggesting that water sales opportunities may be limited this year. On July 10, 2025, the U.S. Department of Agriculture (USDA) released its Objective Forecast for the 2025 California almond crop, projecting total production of 3.0 billion pounds. This represents a 7% increase from the USDA's Subjective Forecast issued on May 12, 2025, and a 10% increase over the 2024 crop of 2.73 billion pounds. We believe this anticipated increase in supply may exert downward pressure on almond pricing throughout the 2025 crop year. While certain regions of California experienced pollination challenges due to significant honeybee colony losses and resulting hive shortages, the Company's operations were not materially impacted during the critical pollination period. Nonetheless, potential yield declines in other growing regions may influence broader market dynamics. Additionally, recently announced U.S. trade measures have heightened the risk of retaliatory tariffs from key export markets, including the European Union, India, and China. These potential trade barriers may negatively affect export demand and further contribute to pricing volatility in the global almond market. While year-to-year results may fluctuate due to external factors, the Company remains focused on long-term value creation. With a strong asset base, disciplined investment approach, and a clear development strategy, we are well-positioned to navigate near-term challenges and advance our strategic priorities. About Tejon Ranch Co. Tejon Ranch Co. (NYSE: TRC) is a diversified real estate development and agribusiness company, whose principal asset is its 270,000-acre land holding located approximately 60 miles north of Los Angeles and 15 miles south of Bakersfield. More information about Tejon Ranch Co. can be found on the Company's website at www.tejonranch.com. Forward Looking Statements: The statements contained herein, which are not historical facts, are forward-looking statements based on economic forecasts, strategic plans and other factors, which by their nature involve risk and uncertainties. In particular, among the factors that could cause actual results to differ materially are the following: business conditions and the general economy, future commodity prices and yields, external market forces, the ability to obtain various governmental entitlements and permits, interest rates, and other risks inherent in real estate and agriculture businesses. For further information on factors that could affect the Company, the reader should refer to the Company’s filings with the Securities and Exchange Commission. (Financial tables follow) TEJON RANCH CO. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS($ in thousands, except per share amounts) June 30, 2025 December 31, 2024 (unaudited) ASSETS Current Assets: Cash and cash equivalents$2,500 $39,267Marketable securities - available-for-sale 17,554 14,441Accounts receivable 1,759 7,916Inventories 8,681 3,972Prepaid expenses and other current assets 2,770 3,806Total current assets 33,264 69,402Real estate and improvements - held for lease, net 40,762 16,253Real estate development (includes $126,009 at June 30, 2025 and $124,136 at December 31, 2024, attributable to CFL) 384,035 377,905Property and equipment, net 58,792 56,387Investments in unconsolidated joint ventures 31,264 28,980Net investment in water assets 65,480 55,091Other assets 4,944 3,980TOTAL ASSETS$618,541 $607,998 LIABILITIES AND EQUITY Current Liabilities: Trade accounts payable$10,052 $9,085Accrued liabilities and other 2,373 5,549Deferred income 2,397 2,162Total current liabilities 14,822 16,796Revolving line of credit 81,942 66,942Long-term deferred gains 10,851 11,447Deferred tax liability 9,024 9,059Other liabilities 15,011 14,798Total liabilities 131,650 119,042Commitments and contingencies Equity: Tejon Ranch Co. stockholders’ equity Common stock, $0.50 par value per share: Authorized shares - 50,000,000 Issued and outstanding shares - 26,880,668 at June 30, 2025 and 26,822,768 at December 31, 2024 13,441 13,412Additional paid-in capital 349,592 348,497Accumulated other comprehensive income 77 87Retained earnings 108,422 111,598Total Tejon Ranch Co. stockholders’ equity 471,532 473,594Non-controlling interest 15,359 15,362Total equity 486,891 488,956TOTAL LIABILITIES AND EQUITY$618,541 $607,998 TEJON RANCH CO. AND SUBSIDIARIESUNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS($ in thousands, except per share amounts) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Revenues: Real estate - commercial/industrial$5,107 $2,550 $7,861 $5,495 Mineral resources 1,510 2,032 4,105 4,521 Farming 607 142 2,163 1,007 Ranch operations 1,083 965 2,387 2,072 Total revenues 8,307 5,689 16,516 13,095 Costs and expenses: Real estate - commercial/industrial 3,536 1,990 5,383 3,917 Real estate - resort/residential 304 427 690 1,988 Mineral resources 790 1,115 2,875 3,231 Farming 1,497 1,087 4,045 3,154 Ranch operations 1,335 1,261 2,608 2,488 Corporate expenses 4,900 3,357 9,136 5,849 Total costs and expenses 12,362 9,237 24,737 20,627 Operating loss (4,055) (3,548) (8,221) (7,532)Other income: Investment income 226 630 572 1,315 Other loss, net (4) (71) (80) (141)Total other income, net 222 559 492 1,174 Loss before equity in earnings of unconsolidated joint ventures and income tax benefit (3,833) (2,989) (7,729) (6,358)Equity in earnings of unconsolidated joint ventures, net 2,555 2,769 3,713 4,282 Loss before income tax benefit (1,278) (220) (4,016) (2,076)Income tax expense (benefit) 435 (1,176) (837) (2,118)Net (loss) income (1,713) 956 (3,179) 42 Net loss attributable to non-controlling interest (1) (1) (3) (1)Net (loss) income attributable to common stockholders$(1,712) $957 $(3,176) $43 Net (loss) income per share attributable to common stockholders, basic$(0.06) $0.04 $(0.12) $0.00 Net (loss) income per share attributable to common stockholders, diluted$(0.06) $0.04 $(0.12) $0.00 Non-GAAP Financial Measures This press release includes references to the Company’s non-GAAP financial measure “EBITDA.” EBITDA represents the Company's share of consolidated net income in accordance with GAAP, before interest, taxes, depreciation, and amortization, plus the allocable portion of EBITDA of unconsolidated joint ventures accounted for under the equity method of accounting based upon economic ownership interest, and all determined on a consistent basis in accordance with GAAP. EBITDA is a non-GAAP financial measure and is used by the Company and others as a supplemental measure of performance. Tejon Ranch uses Adjusted EBITDA to assess the performance of the Company's core operations, for financial and operational decision making, and as a supplemental or additional means of evaluating period-to-period comparisons on a consistent basis. Adjusted EBITDA is calculated as EBITDA, excluding stock compensation expense. The Company believes Adjusted EBITDA provides investors relevant and useful information because it permits investors to view income from operations on an unlevered basis before the effects of taxes, depreciation and amortization, and stock compensation expense. By excluding interest expense and income, EBITDA and Adjusted EBITDA allow investors to measure the Company's performance independent of its capital structure and indebtedness and, therefore, allow for a more meaningful comparison of the Company's performance to that of other companies, both in the real estate industry and in other industries. The Company believes that excluding charges related to share-based compensation facilitates a comparison of its operations across periods and among other companies without the variances caused by different valuation methodologies, the volatility of the expense (which depends on market forces outside the Company's control), and the assumptions and the variety of award types that a company can use. In addition, the Company excludes other items impacting comparability to provide a clearer understanding of its core operating performance. EBITDA and Adjusted EBITDA have limitations as measures of the Company's performance. EBITDA and Adjusted EBITDA do not reflect Tejon Ranch's historical cash expenditures or future cash requirements for capital expenditures or contractual commitments. While EBITDA and Adjusted EBITDA are relevant and widely used measures of performance, they do not represent net income or cash flows from operations as defined by GAAP, and they should not be considered as alternatives to those indicators in evaluating performance or liquidity. Further, the Company's computation of EBITDA and Adjusted EBITDA may not be comparable to similar measures reported by other companies. We use Net Debt / Adjusted EBITDA as a non-GAAP financial measure to evaluate our capital structure and ability to service our debt. Management believes this ratio provides useful insight into leverage trends and capital efficiency. Net debt includes TRC debt and the company’s pro rata share of debt held at unconsolidated joint ventures, offset by consolidated and pro rata cash. Adjusted EBITDA is used as a proxy for core operating performance. A reconciliation is provided below. TEJON RANCH CO.Non-GAAP Financial Measures(Unaudited) Three Months Ended June 30,($ in thousands) 2025 2024 Net (loss) income$(1,713) $956 Net loss attributable to non-controlling interest (1) (1)Interest, net Consolidated (226) (630)Our share of interest expense from unconsolidated joint ventures 1,473 1,552 Total interest, net 1,247 922 Income tax benefit 435 (1,176)Depreciation and amortization: Consolidated 1,095 915 Our share of depreciation and amortization from unconsolidated joint ventures 1,738 1,687 Total depreciation and amortization 2,833 2,602 EBITDA 2,803 3,305 Stock compensation expense 624 1,841 Items impacting comparability: Shareholder activism expense 1 2,316 — Adjusted EBITDA$5,743 $5,146 1 Represents advisory fees related to shareholder activism matters. Six Months Ended June 30, TTM* Ended June 30,($ in thousands) 2025 2024 2025 Net (loss) income$(3,179) $42 $(533)Net loss attributable to non-controlling interest (3) (1) (4)Interest, net Consolidated (572) (1,315) (1,530)Our share of interest expense from unconsolidated joint ventures 2,934 3,094 6,005 Total interest, net 2,362 1,779 4,475 Income tax benefit (837) (2,118) 2,257 Depreciation and amortization: Consolidated 2,110 1,921 5,074 Our share of depreciation and amortization from unconsolidated joint ventures 3,432 3,294 6,891 Total depreciation and amortization 5,542 5,215 11,965 EBITDA 3,891 4,919 18,168 Stock compensation expense 1,290 2,354 3,118 Items impacting comparability: Shareholder activism expense 1 3,399 — 3,399 Adjusted EBITDA$8,580 $7,273 $24,685 1 Represents advisory fees related to shareholder activism matters.*Trailing Twelve Month (TTM) Summary of Outstanding Debt as of June 30, 2025 (Unaudited) Entity/Borrowing ($ in thousands)Amount% SharePRS DebtRevolving line-of-credit$81,942100%$81,942Petro Travel Plaza Holdings, LLC 11,41260% 6,847TRCC/Rock Outlet Center, LLC 20,38450% 10,192TRC-MRC 1, LLC 21,12150% 10,561TRC-MRC 2, LLC 20,86950% 10,435TRC-MRC 3, LLC 32,25450% 16,127TRC-MRC 4, LLC 60,44050% 30,220TRC-MRC 5, LLC 52,41550% 26,208Total$300,837 $192,532 Capitalization and Debt Ratios(Unaudited) ($ in thousands, except per share amounts)June 30, 2025Period End Share Price$16.96 Outstanding Shares 26,880,668 Market Cap as of Reporting Date$455,896 Total Debt including PRS Unconsolidated Joint Venture Debt$192,532 Total Capitalization$648,428 Debt to total capitalization 29.7%Net debt, including PRS unconsolidated joint venture debt, to TTM adjusted EBITDA (Non-GAAP) 6.5 Non-GAAP Net Debt / Adjusted EBITDA Reconciliation(Unaudited) Non-GAAP Reconciliations ($ in thousands)June 30, 2025Debt Pro Rata Share of JV Debt$110,590 TRC Debt 81,942 Total Adjusted Debt (Non-GAAP)$192,532 Cash and Marketable Securities Pro Rata Share of JV Cash and Marketable Securities$11,956 TRC Cash and Marketable Securities 20,054 Total Adjusted Cash and Marketable Securities (Non-GAAP)$32,010 Net Debt (Non-GAAP) Total Adjusted Debt (Non-GAAP)$192,532 Less: Total Adjusted Cash and Marketable Securities (Non-GAAP) (32,010)Net Debt (Non-GAAP)$160,522 TTM Adjusted EBITDA (Non-GAAP)$24,685 Net Debt / TTM Adjusted EBITDA (Non-GAAP) 6.5 Tejon Ranch Co.Robert D. Velasquez, 661-663-4220Chief Financial Officer, Treasurer, Senior Vice President, Finance and Chief Accounting Officer Tejon Ranch Co.Nicholas Ortiz 661-663-4212Senior Vice President, Corporate Communications & Public Affairs

Tejon Ranch Co. Announces Second Quarter 2025 Financial Results

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