The St. Joe Company Reports Third Quarter 2021 Results | The St. Joe Company
Net Income up 94% for the third quarter of 2021 versus the third quarter of 2020 Net Cash from Operations up 79% for the third quarter of 2021 versus the third quarter of 2020 Record residential backlog totaling 1,661 homesites and 299 Latitude Margaritaville Watersound homes PANAMA CITY BEACH,
October 27, 2021 at 4:10 PM EDT
PDF Version
- Net Income up 94% for the third quarter of 2021 versus the third quarter of 2020
- Net Cash from Operations up 79% for the third quarter of 2021 versus the third quarter of 2020
- Record residential backlog totaling 1,661 homesites and 299 Latitude Margaritaville Watersound homes
Net Cash Provided by Operating Activities for the three months ended September 30, 2021 increased by 79% to $17.9 million compared to $10.0 million for the same period in 2020. For the nine months ended September 30, 2021, Net Cash Provided by Operating Activities increased by 189% to $65.1 million, as compared to $22.5 million for the same period in 2020. Cash Generated for Distribution or Investment (“CGFDI”), a non-GAAP measure that is detailed in the Financial Data included below, for the three months ended September 30, 2021 increased by 100% to $30.8 million, compared to $15.4 million for the same period in 2020. For the nine months ended September 30, 2021, CGFDI increased by 115% to $89.3 million, as compared to $41.6 million for the same period in 2020.
In the third quarter of 2021, the Company invested $56.5 million in capital expenditures, which when combined with the $84.1 million invested in the first two quarters of 2021, totaled $140.6 million for the nine months ended September 30, 2021. In addition, the Company paid $4.7 million in cash dividends in each of the first three quarters of 2021. As of September 30, 2021, the Company had $130.6 million in cash, cash equivalents and other liquid investments.
Jorge Gonzalez, the Company’s President and Chief Executive Officer, said, “Through the first nine months of 2021, our revenue exceeded the total revenue for all of 2020, and we believe we have only begun to scratch the surface of the long-term growth potential in front of us. In the first nine months of 2021, our hospitality and commercial segments generated a total of $90.8 million of revenue representing a 47% increase over the prior period. To further build recurring revenue, we have 665 additional apartment and senior living units and 677 additional hotel rooms currently under construction.
In addition, the growth of club membership has been accelerating. The Company added 207 new members in the third quarter of 2021 for a total of 595 new members for the nine months ended September 30, 2021. By comparison, there were 289 new members for the record setting full-year 2020. As a direct result of growth in membership, club revenue, which we believe is recurring revenue, for the third quarter of 2021 increased by 21%, as compared the same period in 2020.”
Mr. Gonzalez continued, “Similarly, the $70.2 million of revenue generated from residential real estate sales over the past nine months came from the sale of 496 homesites and homes. We had 18,662 homesites in our development pipeline as of September 30, 2021. The $70.2 million of homesite and home sales generated over the last nine months equates to approximately 2.7% of homesites in our development pipeline and approximately 0.3% of the 170,000 residential units entitled in the Bay-Walton Sector Plan alone, not including our entitlements outside of the sector plan. As this area continues to grow with more full-time residents, we have a multi-generational pipeline of entitled residential homesites.”
Mr. Gonzalez concluded, “From 2010 to 2020, the population in Walton County grew by 36.8%, making it the 4th fastest growing county in Florida and 21st fastest growing county in the United States. Historically, most of the development in Bay and Walton counties occurred south of US Highway 98, the main east-to-west arterial road. However, as the area south of US Highway 98 has reached the saturation point, new development has shifted north. The ongoing success of Watersound Origins and Breakfast Point communities, and the early success of Latitude Margaritaville Watersound, confirm this transformation. The number of opportunities available to us has and will continue to increase as development continues north of US Highway 98 into our core contiguous lands.”
On October 27, 2021, the Board of Directors declared a cash dividend of $0.08 per share on its common stock, payable on December 10, 2021 to shareholders of record as of the close of business on November 12, 2021.
Real Estate Revenue
Real estate revenue increased by approximately 27% to $23.5 million in the third quarter of 2021, as compared to $18.5 million in the third quarter of 2020. The Company sold 119 homesites at an average price of approximately $159,000 with gross margins of 64.1% in the third quarter of 2021, as compared to 162 homesites at an average price of approximately $82,000 with gross margins of 49.0% in the third quarter of 2020. The difference in the average sales price, number of homesite closings and gross margin was due to a mix of sales in different communities.
As of September 30, 2021, the Company had 1,661 residential homesites under contract with 16 different local, regional and national homebuilders, which are expected to result in revenue of approximately $97,000 per base homesite, excluding applicable true-up, for a total of $160.7 million over the next several years, as compared to 1,401 residential homesites under contract for a total of $119.3 million as of September 30, 2020.
The Latitude Margaritaville Watersound unconsolidated joint venture project, planned for 3,500 residential homes, contracted the initial releases of homes. As of September 30, 2021, in addition to the 1,661 homesites in the Company’s other residential communities, Latitude Margaritaville Watersound had 299 homes under contract with sales value totaling $121.5 million.
Hospitality Revenue
Hospitality revenue increased by approximately 31% to $22.3 million in the third quarter of 2021 as compared to $17.0 million in the third quarter of 2020. Hospitality revenue continues to benefit from the growth of the Watersound Club membership program and increased visitor activity. The Company added 207 new members in the third quarter of 2021 for a total of 595 new members for the nine months ended September 30, 2021. By comparison, there were 289 new members for the record setting full-year 2020.
In the third quarter of 2021, the Company opened a 143-room Hilton Garden Inn hotel located near the Northwest Florida Beaches International Airport bringing the total number of operational hotel rooms owned (individually by the Company or through an unconsolidated joint venture) or managed through a management agreement to 393. As of September 30, 2021, the Company had under construction an additional 75-room boutique inn and new Watersound Club amenities at Watersound Camp Creek venue, an addition of seven hotel suites at the existing WaterColor Inn, a new 124-room Hotel Indigo in Panama City’s downtown waterfront district and a new 131-room HomeWood Suites by Hilton hotel near the Panama City Beach Sports Complex.
In addition, the Company, with separate joint venture partners, had under construction a 255-room Embassy Suites by Hilton hotel in the Pier Park area of Panama City Beach and an 85-room boutique hotel in Seagrove Beach. Together, the operational hotel rooms and the projects already under construction will bring the total number of hotel rooms to 1,070. The Company intends to operate these new hotels. In addition, 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 accelerated in the third quarter of 2021 as projects were completed and transitioned from construction to the leasing stage. Leasing revenue increased by approximately 44% to $7.1 million in the third quarter of 2021, compared to the same period in 2020. As of September 30, 2021, the Company, through consolidated and unconsolidated joint ventures, had 600 completed apartment units with an additional 517 units under construction.
The Company’s leasable space as of September 30, 2021 consisted of approximately 986,000 square feet, of which approximately 821,000 was leased, compared to approximately 904,000 square feet as of September 30, 2020, of which approximately 758,000 was leased. The Company also has other commercial projects under construction for a combined total of approximately 69,000 square feet of leasable space.
Other Operating and Corporate Expenses
Other operating and corporate expenses for the three months ended September 30, 2021 and 2020 were comparable. The Company continues to manage operating costs to maintain an efficient structure.
Financial data schedules in this press release include consolidated results, summary balance sheets, other operating and corporate expenses and the reconciliation of Cash Generated for Distribution or Investment (CGFDI), a non-GAAP financial measure, for the third quarter of 2021 and 2020, respectively.