Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil Hydroworld Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Five Point Holdings, LLC Reports Third Quarter 2023 Results By: Five Point Holdings, LLC via Business Wire October 19, 2023 at 16:10 PM EDT Third Quarter 2023 and Recent Highlights Valencia sold 146 homesites on approximately 26 acres of land and recognized revenue of $60.6 million. Valencia builder sales of 75 homes during the quarter compared to 79 in the second quarter of 2023. Great Park builder sales of 113 homes during the quarter compared to 177 in the second quarter of 2023. Consolidated revenues of $65.9 million; consolidated net income of $14.2 million. Cash and cash equivalents of $218.3 million as of September 30, 2023. Debt to total capitalization ratio of 24.5% and liquidity of $343.3 million as of September 30, 2023. Extended the maturity date of the Company's $125.0 million unsecured revolving credit facility to April 2026. Five Point Holdings, LLC (“Five Point” or the “Company”) (NYSE:FPH), an owner and developer of large mixed-use planned communities in California, today reported its third quarter 2023 results. Dan Hedigan, Chief Executive Officer, said, “In the third quarter, we built on our positive momentum from the first half of the year, with earnings for the third quarter of $14.2 million and an increase in our cash position of $25.1 million, giving us total cash and cash equivalents of $218.3 million. Notwithstanding the headwinds created by the interest rate environment, we are seeing consistent home sales in our communities and continued interest from home builders in our land. Our results for the quarter reflect our sustained focus on our three main priorities: generating revenue, right-sizing our SG&A, and limiting our capital spend. Given our continued success in cash generation and profitability, I am pleased to announce that today we closed on an amendment to our revolving credit facility, which extends the term through April 2026.” Consolidated Results Liquidity and Capital Resources As of September 30, 2023, total liquidity of $343.3 million was comprised of cash and cash equivalents totaling $218.3 million and borrowing availability of $125.0 million under our unsecured revolving credit facility. Total capital was $1.9 billion, reflecting $2.9 billion in assets and $1.0 billion in liabilities and redeemable noncontrolling interests. Results of Operations for the Three Months Ended September 30, 2023 Revenues. Revenues of $65.9 million for the three months ended September 30, 2023 were primarily generated from land sales at our Valencia segment. At Valencia we closed the sale of land entitled for an aggregate of 146 homesites on approximately 26 acres. The fixed base purchase price of $60.6 million was paid at closing. Equity in loss from unconsolidated entities. Equity in loss from unconsolidated entities was $0.6 million for the three months ended September 30, 2023. The Great Park Venture generated net loss of $1.4 million during the three months ended September 30, 2023, and our share of the net loss from our 37.5% percentage interest, adjusted for basis differences, was $0.4 million. Additionally, we recognized $0.4 million in loss from our 75% interest in the Gateway Commercial Venture. Selling, general, and administrative. Selling, general, and administrative expenses were $11.9 million for the three months ended September 30, 2023. Net income. Consolidated net income for the quarter was $14.2 million. Net income attributable to noncontrolling interests totaled $7.6 million, resulting in net income attributable to the Company of $6.6 million. Net income attributable to noncontrolling interests represents the portion of income allocated to related party partners and members that hold units of the operating company and the San Francisco Venture. Holders of units of the operating company and the San Francisco Venture can redeem their interests for either, at our election, our Class A common shares on a one-for-one basis or cash. In connection with any redemption or exchange, our ownership of our operating subsidiaries will increase thereby reducing the amount of income allocated to noncontrolling interests in subsequent periods. Conference Call Information In conjunction with this release, Five Point will host a conference call on Thursday, October 19, 2023 at 5:00 p.m. Eastern Time. Dan Hedigan, Chief Executive Officer, and Kim Tobler, Chief Financial Officer, will host the call. Interested investors and other parties can listen to a live Internet audio webcast of the conference call that will be available on the Five Point website at ir.fivepoint.com. The conference call can also be accessed by dialing (877) 451-6152 (domestic) or (201) 389-0879 (international). A telephonic replay will be available starting approximately three hours after the end of the call by dialing (844) 512-2921, or for international callers, (412) 317-6671. The passcode for the live call and the replay is 13742066. The telephonic replay will be available until 11:59 p.m. Eastern Time on October 28, 2023. About Five Point Five Point, headquartered in Irvine, California, designs and develops large mixed-use planned communities in Orange County, Los Angeles County, and San Francisco County that combine residential, commercial, retail, educational, and recreational elements with public amenities, including civic areas for parks and open space. Five Point’s communities include the Great Park Neighborhoods® in Irvine, Valencia® in Los Angeles County, and Candlestick® and The San Francisco Shipyard® in the City of San Francisco. These communities are designed to include approximately 40,000 residential homes and approximately 23 million square feet of commercial space. Forward-Looking Statements This press release contains forward-looking statements that are subject to risks and uncertainties. These statements concern expectations, beliefs, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. When used, the words “anticipate,” “believe,” “expect,” “intend,” “may,” “might,” “plan,” “estimate,” “project,” “should,” “will,” “would,” “result” and similar expressions that do not relate solely to historical matters are intended to identify forward-looking statements. Forward-looking statements include, among others, statements that refer to: our expectations of our future home sales and/or builder sales; our future revenues, costs and financial performance, including with respect to cash generation and profitability; and future demographics and market conditions in the areas where our communities are located. We caution you that any forward-looking statements included in this press release are based on our current views and information currently available to us. Forward-looking statements are subject to risks, trends, uncertainties and factors that are beyond our control. Some of these risks and uncertainties are described in more detail in our filings with the SEC, including our Annual Report on Form 10-K, under the heading “Risk Factors.” Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. We caution you therefore against relying on any of these forward-looking statements. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. They are based on estimates and assumptions only as of the date hereof. We undertake no obligation to update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes, except as required by applicable law. FIVE POINT HOLDINGS, LLC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share amounts) (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 REVENUES: Land sales $ 60,694 $ 72 $ 60,685 $ 643 Land sales—related party — 2,817 595 4,529 Management services—related party 4,502 12,108 29,512 18,358 Operating properties 727 419 2,181 2,165 Total revenues 65,923 15,416 92,973 25,695 COSTS AND EXPENSES: Land sales 38,967 — 38,967 — Management services 2,371 7,488 14,419 12,372 Operating properties 1,351 1,580 4,321 5,797 Selling, general, and administrative 11,938 12,030 38,400 41,472 Restructuring — — — 19,437 Total costs and expenses 54,627 21,098 96,107 79,078 OTHER INCOME: Interest income 2,413 307 4,542 445 Miscellaneous 1,074 112 1,033 336 Total other income 3,487 419 5,575 781 EQUITY IN (LOSS) EARNINGS FROM UNCONSOLIDATED ENTITIES (622 ) (4,265 ) 52,554 (4,654 ) INCOME (LOSS) BEFORE INCOME TAX PROVISION 14,161 (9,528 ) 54,995 (57,256 ) INCOME TAX PROVISION (3 ) (3 ) (16 ) (16 ) NET INCOME (LOSS) 14,158 (9,531 ) 54,979 (57,272 ) LESS NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS 7,555 (5,092 ) 29,341 (30,592 ) NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY $ 6,603 $ (4,439 ) $ 25,638 $ (26,680 ) NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY PER CLASS A SHARE Basic $ 0.10 $ (0.06 ) $ 0.37 $ (0.39 ) Diluted $ 0.09 $ (0.07 ) $ 0.37 $ (0.39 ) WEIGHTED AVERAGE CLASS A SHARES OUTSTANDING Basic 68,865,783 68,514,843 68,794,915 68,393,923 Diluted 145,312,266 68,879,642 145,064,113 68,758,722 NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY PER CLASS B SHARE Basic and diluted $ 0.00 $ (0.00 ) $ 0.00 $ (0.00 ) WEIGHTED AVERAGE CLASS B SHARES OUTSTANDING Basic and diluted 79,233,544 79,233,544 79,233,544 79,233,544 FIVE POINT HOLDINGS, LLC CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except shares) (Unaudited) September 30, 2023 December 31, 2022 ASSETS INVENTORIES $ 2,252,783 $ 2,239,125 INVESTMENT IN UNCONSOLIDATED ENTITIES 301,436 331,594 PROPERTIES AND EQUIPMENT, NET 29,381 30,243 INTANGIBLE ASSET, NET—RELATED PARTY 31,029 40,257 CASH AND CASH EQUIVALENTS 218,264 131,771 RESTRICTED CASH AND CERTIFICATES OF DEPOSIT 992 992 RELATED PARTY ASSETS 91,103 97,126 OTHER ASSETS 9,559 14,676 TOTAL $ 2,934,547 $ 2,885,784 LIABILITIES AND CAPITAL LIABILITIES: Notes payable, net $ 621,802 $ 620,651 Accounts payable and other liabilities 100,101 94,426 Related party liabilities 81,547 93,086 Deferred income tax liability, net 11,506 11,506 Payable pursuant to tax receivable agreement 173,208 173,068 Total liabilities 988,164 992,737 REDEEMABLE NONCONTROLLING INTEREST 25,000 25,000 CAPITAL: Class A common shares; No par value; Issued and outstanding: September 30, 2023—69,199,938 shares; December 31, 2022—69,068,354 shares Class B common shares; No par value; Issued and outstanding: September 30, 2023—79,233,544 shares; December 31, 2022—79,233,544 shares Contributed capital 590,551 587,733 Retained earnings 59,024 33,386 Accumulated other comprehensive loss (2,914 ) (2,988 ) Total members’ capital 646,661 618,131 Noncontrolling interests 1,274,722 1,249,916 Total capital 1,921,383 1,868,047 TOTAL $ 2,934,547 $ 2,885,784 FIVE POINT HOLDINGS, LLC SUPPLEMENTAL DATA (In thousands) (Unaudited) Liquidity September 30, 2023 Cash and cash equivalents $ 218,264 Borrowing capacity(1) 125,000 Total liquidity $ 343,264 (1) As of September 30, 2023, no borrowings or letters of credit were outstanding on the Company’s $125.0 million revolving credit facility. Debt to Total Capitalization and Net Debt to Total Capitalization September 30, 2023 Debt(1) $ 625,000 Total capital 1,921,383 Total capitalization $ 2,546,383 Debt to total capitalization 24.5 % Debt(1) $ 625,000 Less: Cash and cash equivalents 218,264 Net debt 406,736 Total capital 1,921,383 Total net capitalization $ 2,328,119 Net debt to total capitalization(2) 17.5 % (1) For purposes of this calculation, debt is the amount due on the Company’s notes payable before offsetting for capitalized deferred financing costs. (2) Net debt to total capitalization is a non-GAAP financial measure defined as net debt (debt less cash and cash equivalents) divided by total net capitalization (net debt plus total capital). The Company believes the ratio of net debt to total capitalization is a relevant and a useful financial measure to investors in understanding the leverage employed in the Company’s operations. However, because net debt to total capitalization is not calculated in accordance with GAAP, this financial measure should not be considered in isolation or as an alternative to financial measures prescribed by GAAP. Rather, this non-GAAP financial measure should be used to supplement the Company's GAAP results. Segment Results The following table reconciles the results of operations of our segments to our consolidated results for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Valencia San Francisco Great Park Commercial Total reportable segments Corporate and unallocated Total under management Removal of unconsolidated entities(1) Total consolidated REVENUES: Land sales $ 60,694 $ — $ 1,255 $ — $ 61,949 $ — $ 61,949 $ (1,255 ) $ 60,694 Land sales—related party — — 2,021 — 2,021 — 2,021 (2,021 ) — Management services—related party(2) — — 4,392 110 4,502 — 4,502 — 4,502 Operating properties 562 165 — 2,154 2,881 — 2,881 (2,154 ) 727 Total revenues 61,256 165 7,668 2,264 71,353 — 71,353 (5,430 ) 65,923 COSTS AND EXPENSES: Land sales 38,967 — — — 38,967 — 38,967 — 38,967 Management services(2) — — 2,371 — 2,371 — 2,371 — 2,371 Operating properties 1,351 — — 829 2,180 — 2,180 (829 ) 1,351 Selling, general, and administrative 2,539 1,033 2,289 1,097 6,958 8,366 15,324 (3,386 ) 11,938 Management fees—related party — — 4,659 — 4,659 — 4,659 (4,659 ) — Total costs and expenses 42,857 1,033 9,319 1,926 55,135 8,366 63,501 (8,874 ) 54,627 OTHER INCOME (EXPENSE): Interest income — 6 1,964 25 1,995 2,407 4,402 (1,989 ) 2,413 Interest expense — — — (721 ) (721 ) — (721 ) 721 — Miscellaneous 1,074 — — — 1,074 — 1,074 — 1,074 Total other income (expense) 1,074 6 1,964 (696 ) 2,348 2,407 4,755 (1,268 ) 3,487 EQUITY IN EARNINGS (LOSS) FROM UNCONSOLIDATED ENTITIES 141 — 327 — 468 — 468 (1,090 ) (622 ) SEGMENT PROFIT (LOSS)/INCOME BEFORE INCOME TAX PROVISION 19,614 (862 ) 640 (358 ) 19,034 (5,959 ) 13,075 1,086 14,161 INCOME TAX PROVISION — — — — — (3 ) (3 ) — (3 ) SEGMENT PROFIT (LOSS)/NET INCOME $ 19,614 $ (862 ) $ 640 $ (358 ) $ 19,034 $ (5,962 ) $ 13,072 $ 1,086 $ 14,158 (1) Represents the removal of the Great Park Venture and Gateway Commercial Venture operating results, which are included in the Great Park segment and Commercial segment operating results at 100% of each venture’s historical basis, respectively, but are not included in our consolidated results as we account for our investment in each venture using the equity method of accounting. (2) For the Great Park and Commercial segments, represents the revenues and expenses attributable to the management company for providing services to the Great Park Venture and the Gateway Commercial Venture, as applicable. Nine Months Ended September 30, 2023 Valencia San Francisco Great Park Commercial Total reportable segments Corporate and unallocated Total under management Removal of unconsolidated entities(1) Total consolidated REVENUES: Land sales $ 60,685 $ — $ 363,056 $ — $ 423,741 $ — $ 423,741 $ (363,056 ) $ 60,685 Land sales—related party 595 — 9,416 — 10,011 — 10,011 (9,416 ) 595 Management services—related party(2) — — 29,191 321 29,512 — 29,512 — 29,512 Operating properties 1,692 489 — 6,329 8,510 — 8,510 (6,329 ) 2,181 Total revenues 62,972 489 401,663 6,650 471,774 — 471,774 (378,801 ) 92,973 COSTS AND EXPENSES: Land sales 38,967 — 165,749 — 204,716 — 204,716 (165,749 ) 38,967 Management services(2) — — 14,419 — 14,419 — 14,419 — 14,419 Operating properties 4,321 — — 2,632 6,953 — 6,953 (2,632 ) 4,321 Selling, general, and administrative 8,580 3,275 7,432 3,250 22,537 26,545 49,082 (10,682 ) 38,400 Management fees—related party — — 36,507 — 36,507 — 36,507 (36,507 ) — Total costs and expenses 51,868 3,275 224,107 5,882 285,132 26,545 311,677 (215,570 ) 96,107 OTHER INCOME (EXPENSE): Interest income — 9 5,172 25 5,206 4,533 9,739 (5,197 ) 4,542 Interest expense — — — (1,829 ) (1,829 ) — (1,829 ) 1,829 — Miscellaneous 1,033 — — — 1,033 — 1,033 — 1,033 Total other income (expense) 1,033 9 5,172 (1,804 ) 4,410 4,533 8,943 (3,368 ) 5,575 EQUITY IN EARNINGS FROM UNCONSOLIDATED ENTITIES 500 — 1,563 — 2,063 — 2,063 50,491 52,554 SEGMENT PROFIT (LOSS)/INCOME BEFORE INCOME TAX PROVISION 12,637 (2,777 ) 184,291 (1,036 ) 193,115 (22,012 ) 171,103 (116,108 ) 54,995 INCOME TAX PROVISION — — — — — (16 ) (16 ) — (16 ) SEGMENT PROFIT (LOSS)/NET INCOME $ 12,637 $ (2,777 ) $ 184,291 $ (1,036 ) $ 193,115 $ (22,028 ) $ 171,087 $ (116,108 ) $ 54,979 (1) Represents the removal of the Great Park Venture and Gateway Commercial Venture operating results, which are included in the Great Park segment and Commercial segment operating results at 100% of each venture’s historical basis, respectively, but are not included in our consolidated results as we account for our investments in each venture using the equity method of accounting. (2) For the Great Park and Commercial segments, represents the revenues and expenses attributable to the management company for providing services to the Great Park Venture and the Gateway Commercial Venture, as applicable. The table below reconciles the Great Park segment results to the equity in (loss) earnings from our investment in the Great Park Venture that is reflected in the condensed consolidated statements of operations for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Segment profit from operations $ 640 $ 184,291 Less net income of management company attributed to the Great Park segment 2,021 14,772 Net (loss) income of the Great Park Venture (1,381 ) 169,519 The Company’s share of net (loss) income of the Great Park Venture (518 ) 63,570 Basis difference accretion (amortization), net 106 (10,498 ) Equity in (loss) earnings from the Great Park Venture $ (412 ) $ 53,072 The table below reconciles the Commercial segment results to the equity in loss from our investment in the Gateway Commercial Venture that is reflected in the condensed consolidated statements of operations for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Segment loss from operations $ (358 ) $ (1,036 ) Less net income of management company attributed to the Commercial segment 110 321 Net loss of the Gateway Commercial Venture (468 ) (1,357 ) Equity in loss from the Gateway Commercial Venture $ (351 ) $ (1,018 ) View source version on businesswire.com: https://www.businesswire.com/news/home/20231019419445/en/Contacts Investor Relations: Kim Tobler, 949-425-5211 Kim.Tobler@fivepoint.com or Media: Eric Morgan, 949-349-1088 Eric.Morgan@fivepoint.com Stock Quote API & Stock News API supplied by www.cloudquote.io Quotes delayed at least 20 minutes. 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Five Point Holdings, LLC Reports Third Quarter 2023 Results By: Five Point Holdings, LLC via Business Wire October 19, 2023 at 16:10 PM EDT Third Quarter 2023 and Recent Highlights Valencia sold 146 homesites on approximately 26 acres of land and recognized revenue of $60.6 million. Valencia builder sales of 75 homes during the quarter compared to 79 in the second quarter of 2023. Great Park builder sales of 113 homes during the quarter compared to 177 in the second quarter of 2023. Consolidated revenues of $65.9 million; consolidated net income of $14.2 million. Cash and cash equivalents of $218.3 million as of September 30, 2023. Debt to total capitalization ratio of 24.5% and liquidity of $343.3 million as of September 30, 2023. Extended the maturity date of the Company's $125.0 million unsecured revolving credit facility to April 2026. Five Point Holdings, LLC (“Five Point” or the “Company”) (NYSE:FPH), an owner and developer of large mixed-use planned communities in California, today reported its third quarter 2023 results. Dan Hedigan, Chief Executive Officer, said, “In the third quarter, we built on our positive momentum from the first half of the year, with earnings for the third quarter of $14.2 million and an increase in our cash position of $25.1 million, giving us total cash and cash equivalents of $218.3 million. Notwithstanding the headwinds created by the interest rate environment, we are seeing consistent home sales in our communities and continued interest from home builders in our land. Our results for the quarter reflect our sustained focus on our three main priorities: generating revenue, right-sizing our SG&A, and limiting our capital spend. Given our continued success in cash generation and profitability, I am pleased to announce that today we closed on an amendment to our revolving credit facility, which extends the term through April 2026.” Consolidated Results Liquidity and Capital Resources As of September 30, 2023, total liquidity of $343.3 million was comprised of cash and cash equivalents totaling $218.3 million and borrowing availability of $125.0 million under our unsecured revolving credit facility. Total capital was $1.9 billion, reflecting $2.9 billion in assets and $1.0 billion in liabilities and redeemable noncontrolling interests. Results of Operations for the Three Months Ended September 30, 2023 Revenues. Revenues of $65.9 million for the three months ended September 30, 2023 were primarily generated from land sales at our Valencia segment. At Valencia we closed the sale of land entitled for an aggregate of 146 homesites on approximately 26 acres. The fixed base purchase price of $60.6 million was paid at closing. Equity in loss from unconsolidated entities. Equity in loss from unconsolidated entities was $0.6 million for the three months ended September 30, 2023. The Great Park Venture generated net loss of $1.4 million during the three months ended September 30, 2023, and our share of the net loss from our 37.5% percentage interest, adjusted for basis differences, was $0.4 million. Additionally, we recognized $0.4 million in loss from our 75% interest in the Gateway Commercial Venture. Selling, general, and administrative. Selling, general, and administrative expenses were $11.9 million for the three months ended September 30, 2023. Net income. Consolidated net income for the quarter was $14.2 million. Net income attributable to noncontrolling interests totaled $7.6 million, resulting in net income attributable to the Company of $6.6 million. Net income attributable to noncontrolling interests represents the portion of income allocated to related party partners and members that hold units of the operating company and the San Francisco Venture. Holders of units of the operating company and the San Francisco Venture can redeem their interests for either, at our election, our Class A common shares on a one-for-one basis or cash. In connection with any redemption or exchange, our ownership of our operating subsidiaries will increase thereby reducing the amount of income allocated to noncontrolling interests in subsequent periods. Conference Call Information In conjunction with this release, Five Point will host a conference call on Thursday, October 19, 2023 at 5:00 p.m. Eastern Time. Dan Hedigan, Chief Executive Officer, and Kim Tobler, Chief Financial Officer, will host the call. Interested investors and other parties can listen to a live Internet audio webcast of the conference call that will be available on the Five Point website at ir.fivepoint.com. The conference call can also be accessed by dialing (877) 451-6152 (domestic) or (201) 389-0879 (international). A telephonic replay will be available starting approximately three hours after the end of the call by dialing (844) 512-2921, or for international callers, (412) 317-6671. The passcode for the live call and the replay is 13742066. The telephonic replay will be available until 11:59 p.m. Eastern Time on October 28, 2023. About Five Point Five Point, headquartered in Irvine, California, designs and develops large mixed-use planned communities in Orange County, Los Angeles County, and San Francisco County that combine residential, commercial, retail, educational, and recreational elements with public amenities, including civic areas for parks and open space. Five Point’s communities include the Great Park Neighborhoods® in Irvine, Valencia® in Los Angeles County, and Candlestick® and The San Francisco Shipyard® in the City of San Francisco. These communities are designed to include approximately 40,000 residential homes and approximately 23 million square feet of commercial space. Forward-Looking Statements This press release contains forward-looking statements that are subject to risks and uncertainties. These statements concern expectations, beliefs, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. When used, the words “anticipate,” “believe,” “expect,” “intend,” “may,” “might,” “plan,” “estimate,” “project,” “should,” “will,” “would,” “result” and similar expressions that do not relate solely to historical matters are intended to identify forward-looking statements. Forward-looking statements include, among others, statements that refer to: our expectations of our future home sales and/or builder sales; our future revenues, costs and financial performance, including with respect to cash generation and profitability; and future demographics and market conditions in the areas where our communities are located. We caution you that any forward-looking statements included in this press release are based on our current views and information currently available to us. Forward-looking statements are subject to risks, trends, uncertainties and factors that are beyond our control. Some of these risks and uncertainties are described in more detail in our filings with the SEC, including our Annual Report on Form 10-K, under the heading “Risk Factors.” Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. We caution you therefore against relying on any of these forward-looking statements. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. They are based on estimates and assumptions only as of the date hereof. We undertake no obligation to update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes, except as required by applicable law. FIVE POINT HOLDINGS, LLC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share amounts) (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 REVENUES: Land sales $ 60,694 $ 72 $ 60,685 $ 643 Land sales—related party — 2,817 595 4,529 Management services—related party 4,502 12,108 29,512 18,358 Operating properties 727 419 2,181 2,165 Total revenues 65,923 15,416 92,973 25,695 COSTS AND EXPENSES: Land sales 38,967 — 38,967 — Management services 2,371 7,488 14,419 12,372 Operating properties 1,351 1,580 4,321 5,797 Selling, general, and administrative 11,938 12,030 38,400 41,472 Restructuring — — — 19,437 Total costs and expenses 54,627 21,098 96,107 79,078 OTHER INCOME: Interest income 2,413 307 4,542 445 Miscellaneous 1,074 112 1,033 336 Total other income 3,487 419 5,575 781 EQUITY IN (LOSS) EARNINGS FROM UNCONSOLIDATED ENTITIES (622 ) (4,265 ) 52,554 (4,654 ) INCOME (LOSS) BEFORE INCOME TAX PROVISION 14,161 (9,528 ) 54,995 (57,256 ) INCOME TAX PROVISION (3 ) (3 ) (16 ) (16 ) NET INCOME (LOSS) 14,158 (9,531 ) 54,979 (57,272 ) LESS NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS 7,555 (5,092 ) 29,341 (30,592 ) NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY $ 6,603 $ (4,439 ) $ 25,638 $ (26,680 ) NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY PER CLASS A SHARE Basic $ 0.10 $ (0.06 ) $ 0.37 $ (0.39 ) Diluted $ 0.09 $ (0.07 ) $ 0.37 $ (0.39 ) WEIGHTED AVERAGE CLASS A SHARES OUTSTANDING Basic 68,865,783 68,514,843 68,794,915 68,393,923 Diluted 145,312,266 68,879,642 145,064,113 68,758,722 NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY PER CLASS B SHARE Basic and diluted $ 0.00 $ (0.00 ) $ 0.00 $ (0.00 ) WEIGHTED AVERAGE CLASS B SHARES OUTSTANDING Basic and diluted 79,233,544 79,233,544 79,233,544 79,233,544 FIVE POINT HOLDINGS, LLC CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except shares) (Unaudited) September 30, 2023 December 31, 2022 ASSETS INVENTORIES $ 2,252,783 $ 2,239,125 INVESTMENT IN UNCONSOLIDATED ENTITIES 301,436 331,594 PROPERTIES AND EQUIPMENT, NET 29,381 30,243 INTANGIBLE ASSET, NET—RELATED PARTY 31,029 40,257 CASH AND CASH EQUIVALENTS 218,264 131,771 RESTRICTED CASH AND CERTIFICATES OF DEPOSIT 992 992 RELATED PARTY ASSETS 91,103 97,126 OTHER ASSETS 9,559 14,676 TOTAL $ 2,934,547 $ 2,885,784 LIABILITIES AND CAPITAL LIABILITIES: Notes payable, net $ 621,802 $ 620,651 Accounts payable and other liabilities 100,101 94,426 Related party liabilities 81,547 93,086 Deferred income tax liability, net 11,506 11,506 Payable pursuant to tax receivable agreement 173,208 173,068 Total liabilities 988,164 992,737 REDEEMABLE NONCONTROLLING INTEREST 25,000 25,000 CAPITAL: Class A common shares; No par value; Issued and outstanding: September 30, 2023—69,199,938 shares; December 31, 2022—69,068,354 shares Class B common shares; No par value; Issued and outstanding: September 30, 2023—79,233,544 shares; December 31, 2022—79,233,544 shares Contributed capital 590,551 587,733 Retained earnings 59,024 33,386 Accumulated other comprehensive loss (2,914 ) (2,988 ) Total members’ capital 646,661 618,131 Noncontrolling interests 1,274,722 1,249,916 Total capital 1,921,383 1,868,047 TOTAL $ 2,934,547 $ 2,885,784 FIVE POINT HOLDINGS, LLC SUPPLEMENTAL DATA (In thousands) (Unaudited) Liquidity September 30, 2023 Cash and cash equivalents $ 218,264 Borrowing capacity(1) 125,000 Total liquidity $ 343,264 (1) As of September 30, 2023, no borrowings or letters of credit were outstanding on the Company’s $125.0 million revolving credit facility. Debt to Total Capitalization and Net Debt to Total Capitalization September 30, 2023 Debt(1) $ 625,000 Total capital 1,921,383 Total capitalization $ 2,546,383 Debt to total capitalization 24.5 % Debt(1) $ 625,000 Less: Cash and cash equivalents 218,264 Net debt 406,736 Total capital 1,921,383 Total net capitalization $ 2,328,119 Net debt to total capitalization(2) 17.5 % (1) For purposes of this calculation, debt is the amount due on the Company’s notes payable before offsetting for capitalized deferred financing costs. (2) Net debt to total capitalization is a non-GAAP financial measure defined as net debt (debt less cash and cash equivalents) divided by total net capitalization (net debt plus total capital). The Company believes the ratio of net debt to total capitalization is a relevant and a useful financial measure to investors in understanding the leverage employed in the Company’s operations. However, because net debt to total capitalization is not calculated in accordance with GAAP, this financial measure should not be considered in isolation or as an alternative to financial measures prescribed by GAAP. Rather, this non-GAAP financial measure should be used to supplement the Company's GAAP results. Segment Results The following table reconciles the results of operations of our segments to our consolidated results for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Valencia San Francisco Great Park Commercial Total reportable segments Corporate and unallocated Total under management Removal of unconsolidated entities(1) Total consolidated REVENUES: Land sales $ 60,694 $ — $ 1,255 $ — $ 61,949 $ — $ 61,949 $ (1,255 ) $ 60,694 Land sales—related party — — 2,021 — 2,021 — 2,021 (2,021 ) — Management services—related party(2) — — 4,392 110 4,502 — 4,502 — 4,502 Operating properties 562 165 — 2,154 2,881 — 2,881 (2,154 ) 727 Total revenues 61,256 165 7,668 2,264 71,353 — 71,353 (5,430 ) 65,923 COSTS AND EXPENSES: Land sales 38,967 — — — 38,967 — 38,967 — 38,967 Management services(2) — — 2,371 — 2,371 — 2,371 — 2,371 Operating properties 1,351 — — 829 2,180 — 2,180 (829 ) 1,351 Selling, general, and administrative 2,539 1,033 2,289 1,097 6,958 8,366 15,324 (3,386 ) 11,938 Management fees—related party — — 4,659 — 4,659 — 4,659 (4,659 ) — Total costs and expenses 42,857 1,033 9,319 1,926 55,135 8,366 63,501 (8,874 ) 54,627 OTHER INCOME (EXPENSE): Interest income — 6 1,964 25 1,995 2,407 4,402 (1,989 ) 2,413 Interest expense — — — (721 ) (721 ) — (721 ) 721 — Miscellaneous 1,074 — — — 1,074 — 1,074 — 1,074 Total other income (expense) 1,074 6 1,964 (696 ) 2,348 2,407 4,755 (1,268 ) 3,487 EQUITY IN EARNINGS (LOSS) FROM UNCONSOLIDATED ENTITIES 141 — 327 — 468 — 468 (1,090 ) (622 ) SEGMENT PROFIT (LOSS)/INCOME BEFORE INCOME TAX PROVISION 19,614 (862 ) 640 (358 ) 19,034 (5,959 ) 13,075 1,086 14,161 INCOME TAX PROVISION — — — — — (3 ) (3 ) — (3 ) SEGMENT PROFIT (LOSS)/NET INCOME $ 19,614 $ (862 ) $ 640 $ (358 ) $ 19,034 $ (5,962 ) $ 13,072 $ 1,086 $ 14,158 (1) Represents the removal of the Great Park Venture and Gateway Commercial Venture operating results, which are included in the Great Park segment and Commercial segment operating results at 100% of each venture’s historical basis, respectively, but are not included in our consolidated results as we account for our investment in each venture using the equity method of accounting. (2) For the Great Park and Commercial segments, represents the revenues and expenses attributable to the management company for providing services to the Great Park Venture and the Gateway Commercial Venture, as applicable. Nine Months Ended September 30, 2023 Valencia San Francisco Great Park Commercial Total reportable segments Corporate and unallocated Total under management Removal of unconsolidated entities(1) Total consolidated REVENUES: Land sales $ 60,685 $ — $ 363,056 $ — $ 423,741 $ — $ 423,741 $ (363,056 ) $ 60,685 Land sales—related party 595 — 9,416 — 10,011 — 10,011 (9,416 ) 595 Management services—related party(2) — — 29,191 321 29,512 — 29,512 — 29,512 Operating properties 1,692 489 — 6,329 8,510 — 8,510 (6,329 ) 2,181 Total revenues 62,972 489 401,663 6,650 471,774 — 471,774 (378,801 ) 92,973 COSTS AND EXPENSES: Land sales 38,967 — 165,749 — 204,716 — 204,716 (165,749 ) 38,967 Management services(2) — — 14,419 — 14,419 — 14,419 — 14,419 Operating properties 4,321 — — 2,632 6,953 — 6,953 (2,632 ) 4,321 Selling, general, and administrative 8,580 3,275 7,432 3,250 22,537 26,545 49,082 (10,682 ) 38,400 Management fees—related party — — 36,507 — 36,507 — 36,507 (36,507 ) — Total costs and expenses 51,868 3,275 224,107 5,882 285,132 26,545 311,677 (215,570 ) 96,107 OTHER INCOME (EXPENSE): Interest income — 9 5,172 25 5,206 4,533 9,739 (5,197 ) 4,542 Interest expense — — — (1,829 ) (1,829 ) — (1,829 ) 1,829 — Miscellaneous 1,033 — — — 1,033 — 1,033 — 1,033 Total other income (expense) 1,033 9 5,172 (1,804 ) 4,410 4,533 8,943 (3,368 ) 5,575 EQUITY IN EARNINGS FROM UNCONSOLIDATED ENTITIES 500 — 1,563 — 2,063 — 2,063 50,491 52,554 SEGMENT PROFIT (LOSS)/INCOME BEFORE INCOME TAX PROVISION 12,637 (2,777 ) 184,291 (1,036 ) 193,115 (22,012 ) 171,103 (116,108 ) 54,995 INCOME TAX PROVISION — — — — — (16 ) (16 ) — (16 ) SEGMENT PROFIT (LOSS)/NET INCOME $ 12,637 $ (2,777 ) $ 184,291 $ (1,036 ) $ 193,115 $ (22,028 ) $ 171,087 $ (116,108 ) $ 54,979 (1) Represents the removal of the Great Park Venture and Gateway Commercial Venture operating results, which are included in the Great Park segment and Commercial segment operating results at 100% of each venture’s historical basis, respectively, but are not included in our consolidated results as we account for our investments in each venture using the equity method of accounting. (2) For the Great Park and Commercial segments, represents the revenues and expenses attributable to the management company for providing services to the Great Park Venture and the Gateway Commercial Venture, as applicable. The table below reconciles the Great Park segment results to the equity in (loss) earnings from our investment in the Great Park Venture that is reflected in the condensed consolidated statements of operations for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Segment profit from operations $ 640 $ 184,291 Less net income of management company attributed to the Great Park segment 2,021 14,772 Net (loss) income of the Great Park Venture (1,381 ) 169,519 The Company’s share of net (loss) income of the Great Park Venture (518 ) 63,570 Basis difference accretion (amortization), net 106 (10,498 ) Equity in (loss) earnings from the Great Park Venture $ (412 ) $ 53,072 The table below reconciles the Commercial segment results to the equity in loss from our investment in the Gateway Commercial Venture that is reflected in the condensed consolidated statements of operations for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Segment loss from operations $ (358 ) $ (1,036 ) Less net income of management company attributed to the Commercial segment 110 321 Net loss of the Gateway Commercial Venture (468 ) (1,357 ) Equity in loss from the Gateway Commercial Venture $ (351 ) $ (1,018 ) View source version on businesswire.com: https://www.businesswire.com/news/home/20231019419445/en/Contacts Investor Relations: Kim Tobler, 949-425-5211 Kim.Tobler@fivepoint.com or Media: Eric Morgan, 949-349-1088 Eric.Morgan@fivepoint.com
Third Quarter 2023 and Recent Highlights Valencia sold 146 homesites on approximately 26 acres of land and recognized revenue of $60.6 million. Valencia builder sales of 75 homes during the quarter compared to 79 in the second quarter of 2023. Great Park builder sales of 113 homes during the quarter compared to 177 in the second quarter of 2023. Consolidated revenues of $65.9 million; consolidated net income of $14.2 million. Cash and cash equivalents of $218.3 million as of September 30, 2023. Debt to total capitalization ratio of 24.5% and liquidity of $343.3 million as of September 30, 2023. Extended the maturity date of the Company's $125.0 million unsecured revolving credit facility to April 2026.
Five Point Holdings, LLC (“Five Point” or the “Company”) (NYSE:FPH), an owner and developer of large mixed-use planned communities in California, today reported its third quarter 2023 results. Dan Hedigan, Chief Executive Officer, said, “In the third quarter, we built on our positive momentum from the first half of the year, with earnings for the third quarter of $14.2 million and an increase in our cash position of $25.1 million, giving us total cash and cash equivalents of $218.3 million. Notwithstanding the headwinds created by the interest rate environment, we are seeing consistent home sales in our communities and continued interest from home builders in our land. Our results for the quarter reflect our sustained focus on our three main priorities: generating revenue, right-sizing our SG&A, and limiting our capital spend. Given our continued success in cash generation and profitability, I am pleased to announce that today we closed on an amendment to our revolving credit facility, which extends the term through April 2026.” Consolidated Results Liquidity and Capital Resources As of September 30, 2023, total liquidity of $343.3 million was comprised of cash and cash equivalents totaling $218.3 million and borrowing availability of $125.0 million under our unsecured revolving credit facility. Total capital was $1.9 billion, reflecting $2.9 billion in assets and $1.0 billion in liabilities and redeemable noncontrolling interests. Results of Operations for the Three Months Ended September 30, 2023 Revenues. Revenues of $65.9 million for the three months ended September 30, 2023 were primarily generated from land sales at our Valencia segment. At Valencia we closed the sale of land entitled for an aggregate of 146 homesites on approximately 26 acres. The fixed base purchase price of $60.6 million was paid at closing. Equity in loss from unconsolidated entities. Equity in loss from unconsolidated entities was $0.6 million for the three months ended September 30, 2023. The Great Park Venture generated net loss of $1.4 million during the three months ended September 30, 2023, and our share of the net loss from our 37.5% percentage interest, adjusted for basis differences, was $0.4 million. Additionally, we recognized $0.4 million in loss from our 75% interest in the Gateway Commercial Venture. Selling, general, and administrative. Selling, general, and administrative expenses were $11.9 million for the three months ended September 30, 2023. Net income. Consolidated net income for the quarter was $14.2 million. Net income attributable to noncontrolling interests totaled $7.6 million, resulting in net income attributable to the Company of $6.6 million. Net income attributable to noncontrolling interests represents the portion of income allocated to related party partners and members that hold units of the operating company and the San Francisco Venture. Holders of units of the operating company and the San Francisco Venture can redeem their interests for either, at our election, our Class A common shares on a one-for-one basis or cash. In connection with any redemption or exchange, our ownership of our operating subsidiaries will increase thereby reducing the amount of income allocated to noncontrolling interests in subsequent periods. Conference Call Information In conjunction with this release, Five Point will host a conference call on Thursday, October 19, 2023 at 5:00 p.m. Eastern Time. Dan Hedigan, Chief Executive Officer, and Kim Tobler, Chief Financial Officer, will host the call. Interested investors and other parties can listen to a live Internet audio webcast of the conference call that will be available on the Five Point website at ir.fivepoint.com. The conference call can also be accessed by dialing (877) 451-6152 (domestic) or (201) 389-0879 (international). A telephonic replay will be available starting approximately three hours after the end of the call by dialing (844) 512-2921, or for international callers, (412) 317-6671. The passcode for the live call and the replay is 13742066. The telephonic replay will be available until 11:59 p.m. Eastern Time on October 28, 2023. About Five Point Five Point, headquartered in Irvine, California, designs and develops large mixed-use planned communities in Orange County, Los Angeles County, and San Francisco County that combine residential, commercial, retail, educational, and recreational elements with public amenities, including civic areas for parks and open space. Five Point’s communities include the Great Park Neighborhoods® in Irvine, Valencia® in Los Angeles County, and Candlestick® and The San Francisco Shipyard® in the City of San Francisco. These communities are designed to include approximately 40,000 residential homes and approximately 23 million square feet of commercial space. Forward-Looking Statements This press release contains forward-looking statements that are subject to risks and uncertainties. These statements concern expectations, beliefs, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. When used, the words “anticipate,” “believe,” “expect,” “intend,” “may,” “might,” “plan,” “estimate,” “project,” “should,” “will,” “would,” “result” and similar expressions that do not relate solely to historical matters are intended to identify forward-looking statements. Forward-looking statements include, among others, statements that refer to: our expectations of our future home sales and/or builder sales; our future revenues, costs and financial performance, including with respect to cash generation and profitability; and future demographics and market conditions in the areas where our communities are located. We caution you that any forward-looking statements included in this press release are based on our current views and information currently available to us. Forward-looking statements are subject to risks, trends, uncertainties and factors that are beyond our control. Some of these risks and uncertainties are described in more detail in our filings with the SEC, including our Annual Report on Form 10-K, under the heading “Risk Factors.” Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. We caution you therefore against relying on any of these forward-looking statements. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. They are based on estimates and assumptions only as of the date hereof. We undertake no obligation to update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes, except as required by applicable law. FIVE POINT HOLDINGS, LLC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share amounts) (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 REVENUES: Land sales $ 60,694 $ 72 $ 60,685 $ 643 Land sales—related party — 2,817 595 4,529 Management services—related party 4,502 12,108 29,512 18,358 Operating properties 727 419 2,181 2,165 Total revenues 65,923 15,416 92,973 25,695 COSTS AND EXPENSES: Land sales 38,967 — 38,967 — Management services 2,371 7,488 14,419 12,372 Operating properties 1,351 1,580 4,321 5,797 Selling, general, and administrative 11,938 12,030 38,400 41,472 Restructuring — — — 19,437 Total costs and expenses 54,627 21,098 96,107 79,078 OTHER INCOME: Interest income 2,413 307 4,542 445 Miscellaneous 1,074 112 1,033 336 Total other income 3,487 419 5,575 781 EQUITY IN (LOSS) EARNINGS FROM UNCONSOLIDATED ENTITIES (622 ) (4,265 ) 52,554 (4,654 ) INCOME (LOSS) BEFORE INCOME TAX PROVISION 14,161 (9,528 ) 54,995 (57,256 ) INCOME TAX PROVISION (3 ) (3 ) (16 ) (16 ) NET INCOME (LOSS) 14,158 (9,531 ) 54,979 (57,272 ) LESS NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS 7,555 (5,092 ) 29,341 (30,592 ) NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY $ 6,603 $ (4,439 ) $ 25,638 $ (26,680 ) NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY PER CLASS A SHARE Basic $ 0.10 $ (0.06 ) $ 0.37 $ (0.39 ) Diluted $ 0.09 $ (0.07 ) $ 0.37 $ (0.39 ) WEIGHTED AVERAGE CLASS A SHARES OUTSTANDING Basic 68,865,783 68,514,843 68,794,915 68,393,923 Diluted 145,312,266 68,879,642 145,064,113 68,758,722 NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY PER CLASS B SHARE Basic and diluted $ 0.00 $ (0.00 ) $ 0.00 $ (0.00 ) WEIGHTED AVERAGE CLASS B SHARES OUTSTANDING Basic and diluted 79,233,544 79,233,544 79,233,544 79,233,544 FIVE POINT HOLDINGS, LLC CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except shares) (Unaudited) September 30, 2023 December 31, 2022 ASSETS INVENTORIES $ 2,252,783 $ 2,239,125 INVESTMENT IN UNCONSOLIDATED ENTITIES 301,436 331,594 PROPERTIES AND EQUIPMENT, NET 29,381 30,243 INTANGIBLE ASSET, NET—RELATED PARTY 31,029 40,257 CASH AND CASH EQUIVALENTS 218,264 131,771 RESTRICTED CASH AND CERTIFICATES OF DEPOSIT 992 992 RELATED PARTY ASSETS 91,103 97,126 OTHER ASSETS 9,559 14,676 TOTAL $ 2,934,547 $ 2,885,784 LIABILITIES AND CAPITAL LIABILITIES: Notes payable, net $ 621,802 $ 620,651 Accounts payable and other liabilities 100,101 94,426 Related party liabilities 81,547 93,086 Deferred income tax liability, net 11,506 11,506 Payable pursuant to tax receivable agreement 173,208 173,068 Total liabilities 988,164 992,737 REDEEMABLE NONCONTROLLING INTEREST 25,000 25,000 CAPITAL: Class A common shares; No par value; Issued and outstanding: September 30, 2023—69,199,938 shares; December 31, 2022—69,068,354 shares Class B common shares; No par value; Issued and outstanding: September 30, 2023—79,233,544 shares; December 31, 2022—79,233,544 shares Contributed capital 590,551 587,733 Retained earnings 59,024 33,386 Accumulated other comprehensive loss (2,914 ) (2,988 ) Total members’ capital 646,661 618,131 Noncontrolling interests 1,274,722 1,249,916 Total capital 1,921,383 1,868,047 TOTAL $ 2,934,547 $ 2,885,784 FIVE POINT HOLDINGS, LLC SUPPLEMENTAL DATA (In thousands) (Unaudited) Liquidity September 30, 2023 Cash and cash equivalents $ 218,264 Borrowing capacity(1) 125,000 Total liquidity $ 343,264 (1) As of September 30, 2023, no borrowings or letters of credit were outstanding on the Company’s $125.0 million revolving credit facility. Debt to Total Capitalization and Net Debt to Total Capitalization September 30, 2023 Debt(1) $ 625,000 Total capital 1,921,383 Total capitalization $ 2,546,383 Debt to total capitalization 24.5 % Debt(1) $ 625,000 Less: Cash and cash equivalents 218,264 Net debt 406,736 Total capital 1,921,383 Total net capitalization $ 2,328,119 Net debt to total capitalization(2) 17.5 % (1) For purposes of this calculation, debt is the amount due on the Company’s notes payable before offsetting for capitalized deferred financing costs. (2) Net debt to total capitalization is a non-GAAP financial measure defined as net debt (debt less cash and cash equivalents) divided by total net capitalization (net debt plus total capital). The Company believes the ratio of net debt to total capitalization is a relevant and a useful financial measure to investors in understanding the leverage employed in the Company’s operations. However, because net debt to total capitalization is not calculated in accordance with GAAP, this financial measure should not be considered in isolation or as an alternative to financial measures prescribed by GAAP. Rather, this non-GAAP financial measure should be used to supplement the Company's GAAP results. Segment Results The following table reconciles the results of operations of our segments to our consolidated results for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Valencia San Francisco Great Park Commercial Total reportable segments Corporate and unallocated Total under management Removal of unconsolidated entities(1) Total consolidated REVENUES: Land sales $ 60,694 $ — $ 1,255 $ — $ 61,949 $ — $ 61,949 $ (1,255 ) $ 60,694 Land sales—related party — — 2,021 — 2,021 — 2,021 (2,021 ) — Management services—related party(2) — — 4,392 110 4,502 — 4,502 — 4,502 Operating properties 562 165 — 2,154 2,881 — 2,881 (2,154 ) 727 Total revenues 61,256 165 7,668 2,264 71,353 — 71,353 (5,430 ) 65,923 COSTS AND EXPENSES: Land sales 38,967 — — — 38,967 — 38,967 — 38,967 Management services(2) — — 2,371 — 2,371 — 2,371 — 2,371 Operating properties 1,351 — — 829 2,180 — 2,180 (829 ) 1,351 Selling, general, and administrative 2,539 1,033 2,289 1,097 6,958 8,366 15,324 (3,386 ) 11,938 Management fees—related party — — 4,659 — 4,659 — 4,659 (4,659 ) — Total costs and expenses 42,857 1,033 9,319 1,926 55,135 8,366 63,501 (8,874 ) 54,627 OTHER INCOME (EXPENSE): Interest income — 6 1,964 25 1,995 2,407 4,402 (1,989 ) 2,413 Interest expense — — — (721 ) (721 ) — (721 ) 721 — Miscellaneous 1,074 — — — 1,074 — 1,074 — 1,074 Total other income (expense) 1,074 6 1,964 (696 ) 2,348 2,407 4,755 (1,268 ) 3,487 EQUITY IN EARNINGS (LOSS) FROM UNCONSOLIDATED ENTITIES 141 — 327 — 468 — 468 (1,090 ) (622 ) SEGMENT PROFIT (LOSS)/INCOME BEFORE INCOME TAX PROVISION 19,614 (862 ) 640 (358 ) 19,034 (5,959 ) 13,075 1,086 14,161 INCOME TAX PROVISION — — — — — (3 ) (3 ) — (3 ) SEGMENT PROFIT (LOSS)/NET INCOME $ 19,614 $ (862 ) $ 640 $ (358 ) $ 19,034 $ (5,962 ) $ 13,072 $ 1,086 $ 14,158 (1) Represents the removal of the Great Park Venture and Gateway Commercial Venture operating results, which are included in the Great Park segment and Commercial segment operating results at 100% of each venture’s historical basis, respectively, but are not included in our consolidated results as we account for our investment in each venture using the equity method of accounting. (2) For the Great Park and Commercial segments, represents the revenues and expenses attributable to the management company for providing services to the Great Park Venture and the Gateway Commercial Venture, as applicable. Nine Months Ended September 30, 2023 Valencia San Francisco Great Park Commercial Total reportable segments Corporate and unallocated Total under management Removal of unconsolidated entities(1) Total consolidated REVENUES: Land sales $ 60,685 $ — $ 363,056 $ — $ 423,741 $ — $ 423,741 $ (363,056 ) $ 60,685 Land sales—related party 595 — 9,416 — 10,011 — 10,011 (9,416 ) 595 Management services—related party(2) — — 29,191 321 29,512 — 29,512 — 29,512 Operating properties 1,692 489 — 6,329 8,510 — 8,510 (6,329 ) 2,181 Total revenues 62,972 489 401,663 6,650 471,774 — 471,774 (378,801 ) 92,973 COSTS AND EXPENSES: Land sales 38,967 — 165,749 — 204,716 — 204,716 (165,749 ) 38,967 Management services(2) — — 14,419 — 14,419 — 14,419 — 14,419 Operating properties 4,321 — — 2,632 6,953 — 6,953 (2,632 ) 4,321 Selling, general, and administrative 8,580 3,275 7,432 3,250 22,537 26,545 49,082 (10,682 ) 38,400 Management fees—related party — — 36,507 — 36,507 — 36,507 (36,507 ) — Total costs and expenses 51,868 3,275 224,107 5,882 285,132 26,545 311,677 (215,570 ) 96,107 OTHER INCOME (EXPENSE): Interest income — 9 5,172 25 5,206 4,533 9,739 (5,197 ) 4,542 Interest expense — — — (1,829 ) (1,829 ) — (1,829 ) 1,829 — Miscellaneous 1,033 — — — 1,033 — 1,033 — 1,033 Total other income (expense) 1,033 9 5,172 (1,804 ) 4,410 4,533 8,943 (3,368 ) 5,575 EQUITY IN EARNINGS FROM UNCONSOLIDATED ENTITIES 500 — 1,563 — 2,063 — 2,063 50,491 52,554 SEGMENT PROFIT (LOSS)/INCOME BEFORE INCOME TAX PROVISION 12,637 (2,777 ) 184,291 (1,036 ) 193,115 (22,012 ) 171,103 (116,108 ) 54,995 INCOME TAX PROVISION — — — — — (16 ) (16 ) — (16 ) SEGMENT PROFIT (LOSS)/NET INCOME $ 12,637 $ (2,777 ) $ 184,291 $ (1,036 ) $ 193,115 $ (22,028 ) $ 171,087 $ (116,108 ) $ 54,979 (1) Represents the removal of the Great Park Venture and Gateway Commercial Venture operating results, which are included in the Great Park segment and Commercial segment operating results at 100% of each venture’s historical basis, respectively, but are not included in our consolidated results as we account for our investments in each venture using the equity method of accounting. (2) For the Great Park and Commercial segments, represents the revenues and expenses attributable to the management company for providing services to the Great Park Venture and the Gateway Commercial Venture, as applicable. The table below reconciles the Great Park segment results to the equity in (loss) earnings from our investment in the Great Park Venture that is reflected in the condensed consolidated statements of operations for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Segment profit from operations $ 640 $ 184,291 Less net income of management company attributed to the Great Park segment 2,021 14,772 Net (loss) income of the Great Park Venture (1,381 ) 169,519 The Company’s share of net (loss) income of the Great Park Venture (518 ) 63,570 Basis difference accretion (amortization), net 106 (10,498 ) Equity in (loss) earnings from the Great Park Venture $ (412 ) $ 53,072 The table below reconciles the Commercial segment results to the equity in loss from our investment in the Gateway Commercial Venture that is reflected in the condensed consolidated statements of operations for the three and nine months ended September 30, 2023 (in thousands): Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Segment loss from operations $ (358 ) $ (1,036 ) Less net income of management company attributed to the Commercial segment 110 321 Net loss of the Gateway Commercial Venture (468 ) (1,357 ) Equity in loss from the Gateway Commercial Venture $ (351 ) $ (1,018 ) View source version on businesswire.com: https://www.businesswire.com/news/home/20231019419445/en/
Investor Relations: Kim Tobler, 949-425-5211 Kim.Tobler@fivepoint.com or Media: Eric Morgan, 949-349-1088 Eric.Morgan@fivepoint.com
