Welcome to Alico's Fourth Quarter and Full Year 2022 Earnings Conference Call. At this time, all participants are on a listen-only mode. As a reminder, today's conference is being recorded. Earlier today, the company issued a press release announcing its results for the fourth quarter and full year ending September 30th, 2022. If you have not had a chance to view the release, it is available on the investor relations portion of the company's website at alicoinc.com. This call is being webcast and replay will be available on Alico's website as well. Before we begin, we would like to remind everyone that the prepared remarks today contain forward-looking statements. Such statements are subject to risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied in these statements.
Important factors that could cause or contribute to such differences include the risk factors detailed in the company's annual report on Form 10-K, as well as its future quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments thereto filed with the SEC and those mentioned in the earnings release. The company undertakes no obligation to subsequently update or revise the forward-looking statements made on today's call, except as required by the law. During this call, the company will also discuss non-GAAP financial measures, including EBITDA and Adjusted EBITDA. For more details on these measures, please refer to the company's press release issued earlier today. With that, I'd like to turn the call over to the company's President and CEO, Mr. John Kiernan.
Thank you, Doug. Thank you everyone for joining us for Alico's fourth quarter and fiscal year ended September 30th, 2022 earnings call this afternoon. Fiscal year 2022 was a challenging year for Alico. Two weather events had a meaningful impact on our company and the Florida citrus industry. As previously discussed, in January, the freeze increased fruit drop for our Valencia crop at the beginning of our harvesting season, and we made the decision to accelerate the harvest of the remaining fruit and that did not have time to mature to optimal quality standards. At the end of September, Hurricane Ian struck southwestern Florida with 150 mi an hour winds. The slow-moving storm moved across the state, causing substantial fruit drop at the majority of our groves. Fortunately, tree damage was largely limited to only one property.
This lost fruit impacted our fiscal year 2022 financial results for an aggregate of approximately $23 million of one-time items for casualty losses and inventory adjustments. Fiscal year 2023 will see lower levels of revenue because we will have less fruit available for sale. Based upon our prior experience with storms of this nature, we anticipate it may take up to two seasons or more for our groves to recover to pre-hurricane production levels. I would point out, however, that after Hurricane Irma struck in 2017, our groves recovered the following harvest season. We maintain crop insurance. We are currently working closely with our insurers and adjusters to evaluate and determine the amount of insurance recovery we may be entitled to, if any.
For the fiscal year ended September 30th, 2022, the company reported net income attributable to Alico common stockholders of approximately $12.5 million, compared to net income attributable to Alico common stockholders of approximately $34.9 million for the fiscal year ended September 30th, 2021. The fiscal year ended 2022 results were negatively impacted by approximately $23 million of one-time items for casualty losses and inventory adjustments related to the impact of Hurricane Ian. Our Adjusted EBITDA, which excludes non-recurring items, was approximately $13.4 million for the fiscal year ended September 30th, 2022, as compared to approximately $25.3 million for fiscal year ended 2021.
Our overall box production for fiscal year 2022 was approximately 5.5 million boxes, a decrease of 12.9% as compared to fiscal year 2021. The company believes that actions taken in recent years make our balance sheet one of our greatest strengths. Our long-term debt levels have been significantly reduced through prepayments, and most of our term debt maturing in 2029 is now non-amortizing. Alico negotiated an extension of its $70 million working capital line of credit with Rabo AgriFinance, Inc until November 1st, 2025. Our $25 million revolving line of credit with MetLife extends until November of 2029. We believe that these credit facilities provide Alico with ample liquidity while the company manages through the impact of the recent weather events.
Senior managers of the company have been working closely with Florida Citrus Mutual, the industry trade group, and government agencies to seek federal relief to aid our recovery from the effects of Hurricane Ian. Alico also took other significant action throughout the fiscal year, such as the following. We repaid approximately $19.6 million of debt, which included a prepayment of approximately $15.6 million on our variable rate term loans. As of September 30th, 2022, we have improved our debt-to-equity ratio to 0.45- 1. It was 0.50- 1 a year ago. Over the past six years, we've reduced our debt balances by 45%, having made principal payments of approximately $91 million. Our current supply agreements have approximately 99% of the fruit committed for the 2023 harvest season.
In 2017, we planted approximately 1.9 million new trees, which has materially increased tree density in our existing and recently purchased groves. We believe our tree planting strategy over the last six years has the long-term potential to enable the new acres we now own to significantly increase box production over the coming years. We continue to evaluate our non-citrus assets and opportunistically sold off ranch land at prices we believe to be attractive to generate cash flow. During the fiscal year 2022, we closed on the sale of approximately 9,400 acres of ranch land, and we still have approximately 20,000 acres of ranch land for potential sale, and we are seeing continued interest from potential buyers.
Future capital allocation decisions will be evaluated in an effort to maximize returns to shareholders, which may include, but are not limited to, pursuing opportunities to acquire additional citrus acres at attractive prices, repurchasing common shares, making other acquisitions, or even considering special dividends as asset sales, such as additional portions of the Alico Ranch, are realized. Our environmental, social, and governance initiatives continue, and we've just published our second annual sustainability report. As previously communicated, our board formed an ESG committee. We launched a sustainability page on the company's corporate website, which includes our sustainability policy, our vendor code of conduct, and our safety manual. We completed a materiality assessment that helped inform a sustainability framework to guide future ESG activities, and we joined the UN Global Compact to support universal sustainability principles of environmental responsibility, labor and human rights, and anti-corruption.
With that, I'd like to turn the call over to Perry Del Vecchio to discuss our more detailed financial results.
Thank you, John, and good afternoon, everyone. As our fourth quarter is not indicative of our full year results due to the seasonal nature of our business, I will focus primarily on the full year fiscal 2022 results today. As a reminder, the majority of our citrus crop is harvested in the second and third quarters of the fiscal year, with the majority of our profit and cash flows also recognized in the second and third quarters. For the fiscal year ended September 30th, 2022, total operating revenue was $91.9 million compared to $108.6 million for the fiscal year ended September 30th, 2021.
Citrus revenue was $89.7 million and $105.8 million for the fiscal years ended September 30th, 2022 and 2021 respectively. The decrease in revenue for the fiscal year ended September 30th, 2022 compared to the fiscal year ended September 30th, 2021 was primarily due to a decrease in the revenue from lower box production, particularly our Valencia fruit and a reduction in our Grove Management Services. The decrease in Early and Mid-Season and Valencia fruit harvested was primarily driven by a decrease in processed box production and a decrease in pound solids per box.
As previously discussed, this was primarily due to the January 2022 freeze event, which increased fruit drop at the beginning of our Valencia harvesting season, and we made the decision to accelerate the harvest of the remaining fruit, which did not have time to mature to optimal quality standards. Our average blended price per pound solid increased from $2.45 in the prior fiscal year to $2.63 for the current fiscal year. This was primarily due to tighter supplies of citrus fruit, which in turn led to reduced inventory levels at the juice processors. Largely offsetting this increase in pricing was the number of fewer Valencia boxes being harvested and lower pound solid per box for the fiscal year ended September 30th, 2022 compared to the prior year, which resulted in lower revenues.
We, along with the entire Florida industry in general, recorded a smaller number of boxes harvested as a result of greater fruit drop during the current harvest season as compared to the previous year. During the fiscal year 2022, we provided our Grove Management Services, which include citrus grove caretaking and harvest and haul management services to approximately 7,400 acres of land owned by third parties of approximately 7,000 acres, which are serviced on a property management agreement, which was entered into in July 2020 with a top 10 grower. During the third quarter of 2022, the property management agreement covering these approximate 7,000 acres was terminated by the grove owner and all property management and caretaking services ceased as of June 10th, 2022.
As part of these agreements, we are reimbursed for all costs incurred relating to providing these services and receive a management fee based on acres covered from the third parties. As a reminder, we record both an increase in revenues and expenses as and when we provide these services. For the fiscal year ended September 30th, 2022, we recorded approximately $11.9 million worth of operating revenue from Grove Management Services as compared to $17 million in the fiscal year ended September 30th, 2021. The terminated property management agreement represents $10.6 million in revenue in fiscal year ended 2022 as compared to $15.8 million in fiscal year ended 2021.
The USDA in its final citrus crop forecast for the 2021, 2022 harvest season indicated that the Florida orange crop decreased by 22.5% to approximately 41.1 million boxes from approximately 53 million boxes in the prior harvest season. In comparison, we declined in the current harvest season by 12.9%. The increase in operating expenses for the fiscal year 2022 as compared to fiscal year 2021 mostly relates to the approximate $23 million in casualty loss and inventory adjustments as a result of Hurricane Ian. This increase was partially offset by a decrease in Grove Management Services and harvest and haul expenses. As previously stated, we entered into an agreement with the top 10 grower to provide property management and caretaking services covering approximately 7,000 acres.
During the third quarter of 2022, the property management agreement covering these approximate 7,000 acres was terminated by the grove owner, and all property and management and caretaking services ceased as of June 10, 2022. For the fiscal year ended 2022, we recorded approximately $10.5 million of operating expenses from Grove Management Services as compared to approximately $15.1 million in the fiscal year ended September 30th, 2021. The terminated property management agreement represented $9.7 million in operating expenses in the fiscal year ended 2022 as compared to $14.3 million in fiscal year ended 2021. We recognized lower harvest and haul expenses due to the lower box reduction previously discussed.
General administrative expenses for the fiscal year ended September 30th, 2022, were approximately $10.1 million compared to approximately $9.5 million for the fiscal year ended September 30th, 2021. The increase was primarily attributable to an increase in legal expenses as compared to fiscal year ended 2021, with the fiscal year 2021 legal expenses reduced by $700,000 reimbursement from insurers for a corporate legal matter from 2018. In fiscal year ended 2022, the company recognized approximately $0.2 million in stock compensation expense for restricted stock awarded to non-executive employees.
These increases were partially offset by a reduction in payroll expenses of approximately $0.3 million relating to a reduction in headcount from 222 on September 30th, 2021, down to 206 at September 30th, 2022, and a reduction in the company's director fees of approximately $0.2 million relating to a modification of the compensation agreement for the board of directors. Other income net for the fiscal years ended September 30th, 2022 and 2021 was approximately $37.8 million and approximately $31.9 million, respectively. The increases in other income net was primarily due to the recording of higher gains on sales of real estate, property, and equipment, and assets held for sale in fiscal year 2022 as compared to the previous fiscal year.
For the fiscal year ended September 30th, 2022, we recorded gains on sale of real estate, property, and equipment, and assets held for sale of approximately $41.1 million relating to the sale of approximately 9,400 acres from the Alico Ranch to several third parties. By comparison, for the fiscal year ended September 30th, 2021, we recognized gains on sale of real estate, property and equipment, and assets held for sale of approximately $35.9 million. Additionally, a decrease in interest expense of approximately $0.7 million for the fiscal year ended September 30th, 2022, as compared to the fiscal year ended September 30th, 2021, was realized due to the reduction of our long-term debt and making of mandatory principal payments along with other prepayments.
During the fiscal year ended September 30th, 2022, we received approximately $1.1 million of additional proceeds under the Florida Citrus Recovery Block Grant Program relating to Hurricane Irma damage sustained in September 2017. Through September 30th, 2022, we received approximately $25.6 million of proceeds under this program. These federal relief proceeds are included as a reduction to operating expenses in the consolidated statements of operations. During the first quarter of fiscal year 2023, we have received the remaining portion of the funds that are due under this program related to the reimbursement of certain crop insurance expenses incurred by usOf approximately $1.3 million.
For the fiscal years ended September 30th, 2022 and September 30th, 2021, we report a net income attributable to Alico common stockholders of approximately $12.5 million and approximately $34.9 million respectively. Our Adjusted EBITDA was approximately $13.4 million for the fiscal year ended September 30th, 2022, as compared to approximately $25.3 million for the fiscal year ended September 30th, 2021. We continue to strengthen our balance sheet. Our working capital was approximately $15.1 million at September 30th, 2022, representing a 1.91- 1 ratio. Our debt-to-equity ratio continues to improve.
At September 30th, 2022, September 30th, 2021, and September 30th, 2020, the ratios were 0.45- 1, 0.50- 1, and 0.67- 1 respectively. This improvement has been driven by continued mandatory prepayments on the long-term debt as well as certain voluntary prepayments, including approximately $15.6 million in April 2022 on our variable rate term loans. Due to the uncertainty related to the estimated fruit drop in box production, we're unable to provide guidance at this time for fiscal year 2023.
During the completion of our annual report on Form 10-K for the fiscal year ending September 30th, 2022, the company identified an error in the calculation of the deferred tax liabilities for the fiscal years 2015 through 2019, resulting in a restatement of balance sheet items as of September 30th, 2021 and as of the end of each fiscal quarter previously reported since December 31st, 2020. The error had no impact on our consolidated statement of operations or our consolidated statement of cash flows presented in the Form 10-K filed earlier this afternoon, but resulted in a cumulative reduction in deferred tax liability and a corresponding cumulative increase in retained earnings of approximately $2,512,000 on our audited consolidated balance sheet as of September 30th, 2021.
I would like to now pass the call back to John.
Thanks, Perry. As we have discussed, although it was a challenging year for our company and the Florida citrus industry, we were able to strengthen our balance sheet through reductions in our debt levels and returned approximately $15.1 million in dividends back to our shareholders. Alico has paid common dividends to shareholders consistently since it became publicly held more than six decades ago. The rate of increased dividend payments since 2019 has been a source of pride as Ranch sale proceeds and operations enabled significant amounts of capital to be returned to shareholders. However, taking into account the impact of the recent storm, Alico's board of directors unanimously voted to reduce its next quarterly common dividend to $0.05 per share.
We believe the investments that Alico has made over the past several years have created what we believe to be the most productive citrus groves in Florida. We will continue to blend a conventional agriculture investment with the ability to optimize the returns on our real assets. We are continuing to work with land use planning professionals to develop and implement this strategy over the next several years, which we expect to help generate greater returns for our shareholders through active land management. With that, we will now open the line up to questions from industry analysts. Doug?
Thank you. Ladies and gentlemen, at this time, we'll be conducting a question-and-answer session. If you'd like to ask a question, you may press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing your star key. Our first question comes from the line of Gerry Sweeney with Roth Capital. Please proceed with your question.
Hey, John and Perry. Thanks for taking my call.
Hi, Gerry.
Curious if you could give us a little bit of insight maybe on the crop insurance, you know, status, you know, sort of process that you have to go through and timing when you could fully understand it, what the availability of insurance, if any, is on that?
I-
Yeah. Sorry, go ahead.
No, that's all right. We'll take them in order. We have crop insurance on all of our acres. It's primarily Catastrophic, so it's gonna measure very significant crop damage. We don't think that is gonna be affecting a majority of our groves. It certainly is gonna affect quite a few of them, but not all of them. We really can't measure at this point until the end of the crop season, until the actual harvest itself. We do estimates right now, but we're actually gonna have to measure the actual results. It's gonna be a few more months.
Got it. I'm gonna switch gears a little bit.
Sure.
Step back to it. When do you get some visibility on the quality of the harvest? Again, just to be clear, the harvest, the fruit that came off the trees during Ian was for this season coming up. We won't really even know for probably a good solid year as to what, like, a big rebound or what kind of rebound we're gonna have. Is that correct?
Similar to what we saw in Hurricane Irma back in 2017. We'll take those in order. Yes, we actually started harvesting our Early and Mid-Season varieties about a week or so ago. That crop, it was probably the most affected. Again, you have to take this with a grain of salt because we still have a lot of evaluation to do, because it was just more mature and larger hanging on the tree when the hurricane and all those forced winds came through in September. It's too early for us to really tell, you know, what that size crop. Unfortunately, we can't give guidance right now, or eventually what the ultimate quality standard and kind of juice quantity is going to be.
You know, the Valencia season most likely is gonna start in kind of mid-February, we're anticipating. Certainly affected by the storm, but not as affected by the storm. There's some reason for some small semblance of optimism there. It's just a timing issue for us with these disclosures because we don't really know all that much today, certainly no more than in September. In another few weeks, we should have much better ideas relative to kind of the early mid crop and its quality standards.
Got it. With visibility as it relates to, we'll say fiscal 2024, early and mid, when would you sort of get a visibility on that harvest, right? Next year's harvest, would that sort of be August, September of this year coming up?
Yeah. Traditionally, we do a kind of our first crop forecast internally, in kind of the late summer months. It would be kind of August going into early September. That there is traditional. That will give us our first visibility into, you know, the first glimpse of what the crop for next season looks like. Again, it would be a waiting game to make sure that the fruit stays on the tree and matures. As we saw in Irma, there was a very quick rebound. You know, we don't wanna go out on a limb and actually say that we expect that that's gonna happen. We will keep our fingers crossed, obviously. Prior to Irma, you know, it has taken 2+ years to kind of rebound to pre-production levels.
It's unfortunately just gonna be another waiting game to get to next summer for the first glimpse, and then fingers crossed as we start the next harvest season next November, December.
Got it. going back to the insurance part, federal relief, any updates on that? I know that's gonna be a process, but-
Um-
If anything has moved in the last week or two, a couple weeks.
Yeah. Unfortunately, and this is starting to sound like a theme, but unfortunately, we don't have a lot of good visibility that's come out of Washington. Most likely is not gonna be a state-driven program. It's almost entirely gonna be dependent on kind of federal funding. We are in kind of wait mode. We're working very closely with Citrus Mutual, our industry trade group. That's kind of the point on this initiative on behalf of all the citrus growers in the state of Florida.
Gotcha. On federal relief, again, I apologize for the questions here, but since I assume some of this, Florida was declared a state of an emergency or, you know, I think probably at the state and federal level, I don't wanna say automatically, but does that open a door for federal funding, or is federal sort of relief funding a whole separate process?
Yeah. We think it's a whole separate process similar to what it was in the past. This isn't like a FEMA disaster emergency. It's really gonna be specific earmarked funds for kind of industry type relief. I think back in very early October, Senator Rubio had sponsored some sort of legislation and outlined a program that was very, very large. Hopefully, you know, that initiative or something similar to that will continue because those funds really, really can go a long way, both for Alico and our friends and peers to keep this citrus industry alive and growing for, you know, generations to come here in Florida.
One more on the real estate side. Just curious as how the market looks backlogged, sort of tone, tenor in terms of how properties demand or activity on the property sales front.
Sure. You know, we seldom get into really big statistics or, you know, information that we haven't actually put in the press release. We have closed a few small transactions in this quarter. As we said in the press release, you know, it is at prices that we consider to be attractive. There is continued demand. We've got several other buyers that are negotiating or in a contract stage at this point. We are still active on the real estate front relative to the Alico Ranch.
Gotcha. Okay. That's it for me.
Thank you, Gerry. Thanks for your support.
Thank you.
That concludes our question and answer session. I'd like to hand it back to Mr. Kiernan for closing remarks.
Thank you everyone for joining our call today and also for your support of Alico. On behalf of Perry and myself and the rest of the Alico team, based down here in Fort Myers, Florida, we look forward to speaking with you about our first quarter results coming up in February. Thanks very much.
Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time, and have a wonderful day.