MAUI LAND & PINEAPPLE COMPANY, INC. The following discussion and analysis of our unaudited condensed consolidated
interim financial condition and results of operations should be read in
conjunction with our annual audited consolidated financial statements and
related notes included in our Annual Report on Form 10-K for the year ending
Overview
On
We own approximately 22,000 acres of land on the island of
• Real Estate-Our real estate operations consist of land planning and entitlement, development and sales activities.
• Leasing-Our leasing operations include residential, resort, commercial, agricultural and industrial land and property leases, licensing of our registered trademarks and trade names. This operating segment also includes the management of ditch, reservoir, and well systems in West and Upcountry Maui and the stewardship of conservation areas.
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• Resort Amenities-We manage the operations of the
We continue to monitor the effects of the COVID-19 pandemic on us, our customers, and our vendors. While we are not able to accurately predict the magnitude or scope of such impacts at this time, should the existence of the COVID-19 pandemic continue for an extended period, our future business operations, including the results of operations, cash flows and financial position will be significantly affected. Appropriate remote work arrangements continue to be established for our employees in order to maintain our financial reporting systems
Results of Operations Three and Six Months EndedJune 30, 2022 compared to Three and Six Months EndedJune 30, 2021 CONSOLIDATED Three Months Ended Six Months Ended June 30, June 30, (unaudited) (unaudited) 2022 2021 2022 2021 (in thousands) (in thousands) Operating revenues$ 13,987 $ 4,950 $ 16,234 $ 7,009 Segment operating costs and expenses (2,034 ) (1,608 ) (3,375 ) (2,959 ) General and administrative (759 ) (574 ) (1,516 ) (1,291 ) Share-based compensation (276 ) (370 ) (654 ) (719 ) Depreciation (277 ) (302 ) (550 ) (602 ) Operating income 10,641 2,096 10,139 1,438 Other income - - - 13 Pension and other postretirement expenses (114 ) (116 ) (229 ) (232 ) Interest expense (2 ) (32 ) (3 ) (65 ) Income from Continuing Operations 10,525 1,948 9,907 1,154 Loss from Discontinued Operations - (69 ) - (209 ) Net income$ 10,525 $ 1,879 $ 9,907 $ 945 Income from Continuing Operations per Common Share$ 0.54 $ 0.10 $ 0.51 $ 0.06 Loss from Discontinued Operations per Common Share $ - $ - $ -$ (0.01 ) Net income per Common Share$ 0.54 $ 0.10 $ 0.51 $ 0.05 REAL ESTATE Three Months Ended Six Months Ended June 30, June 30, (unaudited) (unaudited) 2022 2021 2022 2021 (in thousands) (in thousands) Operating revenues$ 11,600 $ 2,700 $ 11,600 $ 2,700 Operating costs and expenses (707 ) (454 ) (796 ) (552 ) Operating income$ 10,893 $ 2,246 $ 10,804 $ 2,148
In
In
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In
In
In
There were no significant real estate development expenditures during the six
months ended
Real estate development and sales are cyclical and depend on a number of factors. Results for one period are therefore not necessarily indicative of future performance trends in this business segment. Uncertainties associated with the COVID-19 pandemic may, among other things, reduce demand for real estate and impair prospective purchasers' ability to obtain financing, which would adversely affect revenues from our real estate operations.
LEASING
Three Months Ended Six Months Ended
June 30, June 30,
(unaudited) (unaudited)
2022 2021 2022 2021
(in thousands) (in thousands)
Operating revenues $ 2,198 $ 1,962 $ 4,228 $ 3,763
Operating costs and expenses (997 ) (876 ) (1,739 ) (1,716 )
Operating income $ 1,201 $ 1,086 $ 2,489 $ 2,047 The island of
Our leasing operations face substantial competition from other property owners inMaui andHawaii . RESORT AMENITIES AND OTHER Three Months Ended Six Months Ended June 30, June 30, (unaudited) (unaudited) 2022 2021 2022 2021 (in thousands) (in thousands) Operating revenues$ 189 $ 288 $ 406 $ 546 Operating costs and expenses (330 ) (278 ) (840 ) (691 ) Operating income (loss)$ (141 ) $ 10 $ (434 ) $ (145 )
Our Resort Amenities segment includes the operations of the
The decrease in operating revenues for the three and six months ended
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The increase in operating costs for the three and six months ended
LIQUIDITY AND CAPITAL RESOURCES
Liquidity
We had cash on hand of approximately
At
The terms of the Credit Facility include various representations, warranties,
affirmative, negative and financial covenants and events of default customary
for financings of this type. Financial covenants include a minimum liquidity (as
defined) of
We were in compliance with the covenants under the Credit Facility at
Cash Flows
Net cash flow provided by our operating activities was approximately
In
In
The outstanding balance of our Credit Facility remained zero at
No minimum funding contributions are required to be made to our defined benefit pension plan in 2022.
Future Cash Inflows and Outflows
Our business initiatives include investing in our operating infrastructure, continued planning and entitlement efforts on our development projects. This may require borrowing under our Credit Facility or other indebtedness, repayment of which may be dependent on selling of our real estate assets at acceptable prices in condensed timeframes. We believe that our cash on-hand and cash received from operations, together with borrowing capacity under our Credit Facility, will provide sufficient financial flexibility to meet working capital requirements and to fund capital expenditures through the next twelve months and the foreseeable future.
Our indebtedness could have the effect of, among other things, increasing our exposure to general adverse economic and industry conditions, limiting our flexibility in planning for, or reacting to, changes in our business and industry, and limiting our ability to borrow additional funds.
Critical Accounting Policies and Estimates
The preparation of the unaudited condensed consolidated interim financial statements in conformity with GAAP requires the use of accounting estimates. Changes in these estimates and assumptions are considered reasonably possible and may have a material effect on the unaudited condensed consolidated interim financial statements and thus actual results could differ from the amounts reported and disclosed herein. For additional information regarding our critical accounting policies, see the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies" contained within our Annual Report. There have been no significant changes in our critical accounting policies.
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