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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) August 1, 2006
--------------------------------
The St. Joe Company
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(Exact Name of Registrant as Specified in Its Charter)
Florida 1-10466 59-0432511
- ---------------------------- ------------ -------------------
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
245 Riverside Avenue, Suite 500
Jacksonville, FL 32202
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(Address of Principal Executive Offices) (Zip Code)
(904) 301-4200
----------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Not Applicable
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-(c))
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On August 1, 2006, The St. Joe Company (the "Company") issued a press release
announcing the Company's financial results for the quarter ended June 30, 2006.
A copy of the press release is furnished with this Form 8-K as Exhibit 99.1.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.1 Press Release dated August 1, 2006
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE ST. JOE COMPANY
Dated: August 1, 2006 By: /s/ Michael N. Regan
-------------------------------------
Michael N. Regan
Senior Vice President -
Finance and Planning
Exhibit 99.1
The St. Joe Company Reports Second Quarter 2006 Net Income of $0.25 Per Share
JACKSONVILLE, Fla.--(BUSINESS WIRE)--Aug. 1, 2006--The St. Joe
Company (NYSE:JOE):
-- Lowering 2006 Guidance to $0.70 to $1.05 per Share
-- Challenging Conditions Continue in Resort and Seasonal
Residential Markets
-- JOE Expands Relationships with Homebuilders
-- Rural Land Sales Remain Steady
The St. Joe Company (NYSE:JOE) today announced that its Net Income
for the second quarter of 2006 was $19.0 million, or $0.25 per share,
compared to $37.9 million, or $0.50 per share, for the second quarter
of 2005. All per share references in this release are presented on a
diluted basis.
Net Income for the first half of 2006 was $22.7 million, or $0.30
per share, compared to $53.3 million, or $0.70 per share, for the
first half of 2005.
"At established JOE resort towns, including WaterColor and
WaterSound Beach, sales remained slow during the second quarter, which
had a significant impact on revenue and earnings," said JOE chairman,
president and CEO Peter S. Rummell. "Considering the high levels of
resale inventory available in many parts of Florida, including JOE's
core markets in Northwest Florida, we believe activity in our resort
and seasonal markets will remain slow for at least 18 to 24 months
before there is a return to supply-demand equilibrium. Sales in some
of our primary-home communities declined due to softening demand,
reflecting the broader Florida real estate slowdown, along with a
temporary lack of product availability in certain JOE communities
primarily due to permitting and platting issues that have now been
resolved."
"Although challenging conditions continue in our key Florida
resort and seasonal markets, we are seeing sales activity at new
projects," said Rummell. "The introduction of new products in WindMark
Beach and WaterSound at a wider range of price points is showing some
promise."
National and Regional Homebuilders Buy Into JOE's Florida
"We are making good progress working with national and regional
homebuilders," said Rummell. "Earlier today, JOE and Beazer Homes,
USA, Inc. announced a long-term relationship that represents an
initial commitment for 681 single-family, townhouse and multifamily
sites at Laguna Beach West and Beckrich Northeast in Panama City
Beach, SouthWood and Victoria Park. In addition, Beazer Homes has been
selected to build homes in RiverTown."
"In addition, JOE is expanding its relationship with David Weekley
Homes," said Rummell. "These commitments include production of primary
and seasonal home products in WaterSound, ParkPlace in Bay County,
SouthWood and RiverCamps on Crooked Creek. We continue to work with
D.R. Horton, Inc., who is purchasing home sites in Hawks Landing."
"Further, from the submissions of 19 national and regional
homebuilders, proposals from seven have been selected for the purchase
of home sites in RiverTown, including Beazer Homes and David Weekley
Homes. We are in the process of finalizing purchase agreements for
home sites in this project in St. Johns County."
Rural Land Sales Remain Steady; Commercial Pipeline Solid
"St. Joe Land Company continues to make progress with its niche
marketing efforts," said Rummell. "We are seeing significant interest
in our new FloridaWild rural land product. In addition, our commercial
pipeline in Northwest Florida is solid. In the second quarter, we
closed significant sales to a multifamily developer in Tallahassee and
Lowe's in Panama City Beach. However, we had one significant
commercial contract cancelled in the quarter. More multifamily
transactions are in our pipeline, along with a healthy number of
smaller retail land parcels and commerce and business park sales."
Focus Remains on Value Creation
"Florida has been through real estate cycles like this before,"
said Rummell. "It has always emerged stronger, driven primarily by a
diverse economy and an outstanding quality of life that attracts
people to the state. We believe in Florida's long-term future, and we
are maintaining a long-term perspective in managing the company."
"While ultimately we must deliver the value we create through
earnings, we have no intention of chasing short-term earnings through
significant discounting at the expense of long-term value creation,"
said Rummell. "Rather, we intend to be well-positioned for the cycle's
upswing. We are going to move forward with the patience and commitment
necessary to deliver the full value of our land holdings to our
shareholders. We may capitalize on near-term opportunities, but any
steps we take will remain consistent with our long-term value creation
strategy."
"We are taking this opportunity to review and refocus every aspect
of our business," said Rummell. "We've already been able to identify
significant savings from our capital spending program through a
combination of eliminating some costs, trimming others - and in some
cases, delaying some capital spending until market conditions
improve."
FAA Issued Final Environmental Impact Statement for Panama City
Airport
During the second quarter, the Federal Aviation Administration
(FAA) issued its Final Environmental Impact Statement (FEIS) on the
proposed relocation of the Panama City - Bay County International
Airport. In the FEIS, the FAA selected relocation to the West Bay site
- - on land owned by JOE - as its preferred alternative. While there are
still a number of steps remaining to relocate the airport, this
positive FEIS was a significant one. The FAA expects to issue its
Record of Decision (ROD) by the end of September.
Long-Term Trends, Entitlements Expertise Favor JOE
"While we make short-term course adjustments to respond to market
conditions, we continue to believe that long-term trends work in our
favor," said Rummell. "Certainly demographic trends, which we have
discussed often and at length, work in Florida's favor. Florida's
strong, diversified economy and projected population growth are also
advantages for JOE."
"JOE's experience and expertise in gaining entitlements is - and
will remain - a significant advantage in the years ahead," said
Rummell. "Through these entitlements, we are continuing to build a
storehouse of future value. It will never get easier to entitle land
in Florida; it will only get more difficult."
"This growing storehouse of value, in the form of land holdings
entitled for highest and best use, will position us to be fully
prepared to meet the market when conditions improve and demand
increases, not only with our own development efforts, but with our
strategic partners as well," said Rummell. "Our land inventory,
combined with our entitlement skills, makes JOE an important long-term
partner for homebuilders and multifamily, commercial and industrial
developers."
On June 30, 2006, JOE owned approximately 825,000 acres,
concentrated primarily in Northwest Florida. These holdings included
approximately 335,000 acres within 10 miles of the coast of the Gulf
of Mexico and approximately 490,000 acres outside the 10-mile coastal
perimeter, including approximately 48,000 acres in southwest Georgia.
Also, on June 30, 2006, JOE had land-use entitlements in hand or
in process for approximately 44,000 residential units, an increase of
approximately 2,000 units from March 31, and approximately 15.1
million square feet of commercial space. An additional 637 acres is
zoned for commercial uses. These entitlements are on approximately
45,000 acres.
"The additional residential units reflect our objective to get a
broader range of product to market, including additional moderately
priced units," said Chris Corr, senior vice president for strategic
planning. "We have a number of projects moving through the
entitlements process intended to meet demand for more attainable
housing."
Land-use entitlements were also obtained to support development of
a new hospital in Port St. Joe to be operated by Sacred Heart Health
Systems.
See Tables 1, 2, and 3 below for additional information about our
entitlements currently in hand or in process.
2006 OUTLOOK
Lowering 2006 Guidance to $0.70 to $1.05 per Share
"As we progress further into the main selling season for many of
our communities, the near term operating environment remains a
challenge and earnings visibility continues to be extremely limited,
particularly for resort and seasonal residential products," said JOE's
CFO Anthony M. Corriggio. "As a result of these factors, we are
lowering our range of expected full-year earnings to $0.70 to $1.05
per share. There continues to be potential for meaningful variability
of earnings on both sides of this range given that sizable real estate
transactions can be difficult to predict from a timing perspective."
St. Joe Towns & Resorts
"Elevated resale inventories and limited transaction activity in
the resort and seasonal product lines continue to adversely affect
sales across several markets, leading us to further reduce profit
expectations from this segment for the remainder of the year," said
Corriggio. "This reduction is again the most significant single
component of the downward revision in earnings expectations."
"On the primary housing front, we continue to be in active
discussions with several major homebuilders interested in
participating in various JOE projects in Northwest Florida and other
parts of the state," said Corriggio. "The definitive agreements just
announced with Beazer Homes and the expansion of our relationship with
David Weekley Homes are among several initiatives being undertaken to
enhance JOE's ability to deliver primary housing at competitive price
points across multiple markets. The potential exists for additional
transactions to occur in the second half of 2006. However, some of
these transactions are not expected to begin to contribute to earnings
and cash flows until late this year or in 2007."
Commercial Real Estate
"Non-residential commercial (retail, light industrial,
office/showroom) activity continues at a solid pace across our
Northwest Florida markets," said Corriggio. "We expect more than 15
transactions of this type to close in the second half, ranging in size
from $100,000 to several million dollars and with average pricing
greater than $200,000 per acre. Most of the earnings from the Lowe's
transaction closed in the second quarter will be recognized in the
fourth quarter after completion of required infrastructure on the
site. We also continue to see relatively strong demand from regional
and national multifamily developers looking to bring for-rent and
townhouse products to these markets at lower to medium price points,
and have several transactions under contract scheduled to close by the
end of the year. We did, however, have a transaction with a local
developer for a mid-size multifamily/mixed-use parcel result in a
cancelled contract and forfeited deposit in the second quarter. The
parcel remains with JOE for remarketing, but will likely not result in
a 2006 closing."
"In general, nearly all of Commercial's earnings from land sales
should occur in the second half of the year," said Corriggio. "This
activity, much of which is currently under contract or letter of
intent, is expected to contribute approximately $20 million of pretax
gain over the next two quarters. As described in our first quarter
report earlier this year, we are also continuing to evaluate the
potential sale of an additional office building from our Investment
Portfolio."
St. Joe Land Company
"We expect continued good performance from Land Company operations
as we enter the second half," said Corriggio. "Rural and recreational
land sales activity continues to be relatively steady and several
types of product offerings currently appear to have sustained traction
in both demand and pricing. We anticipate several meaningful
transactions involving WoodLands and FloridaWild products, with
closings potentially occurring in the fourth quarter."
CAPITAL INVESTMENT
"We have adjusted our capital investment plans and continue to
evaluate further reductions in light of market conditions," said
Corriggio. "We are thoroughly reviewing all capital investment
decisions in order to properly pace development to meet the market as
well as bring quality first phases in our next-generation projects to
the point of sale in an efficient manner. Subject to further
refinement, we currently expect construction spending at WaterSound,
WindMark Beach, SummerCamp, RiverTown and SevenShores to total
approximately $150 million over the next four quarters. We believe
this represents the bulk of the investment capital necessary to ready
the initial phase of product for sale in these communities. Vertical
construction will not commence at SevenShores until we satisfy
internally-set presale requirements."
SENIOR NOTES AND CREDIT FACILITY
"During the second quarter, we initiated a process to better align
the covenants on our 2002 and 2004 Senior Notes with those contained
in our 2005 Senior Notes and Credit Facility," said Corriggio. "To
this end, on July 28th, we entered into an amendment agreement with
the 2002 note holders that modifies certain financial covenants. The
amendment, when effective, will provide increased leverage capacity
along with increased flexibility in maintaining minimum net worth
levels, one effect of which is to provide additional flexibility
regarding distributions to shareholders. The effectiveness of the
covenant modifications is subject to certain conditions, including,
but not limited to, the Company's prepayment of the $100 million
outstanding 2004 Senior Notes. We have also entered into a loan
agreement to provide a separate source of financing to potentially
repay the 2004 notes at our discretion. Additional details on the
terms of the agreements can be found in our Form 8-K filed on July
31st."
Dividends and Stock Repurchase
A quarterly cash dividend of $0.16 per share of common stock was
paid on June 30 to shareholders of record at the close of business on
June 15, 2006.
On June 30, 2006, 74,092,125 JOE shares were outstanding. The
number of weighted-average diluted shares in the second quarter of
2006 was 74,540,823.
During the second quarter of 2006, JOE expended an aggregate of
$34.3 million for dividends and the acquisition of its shares. JOE
acquired 483,257 of its shares at a cost of $22.3 million, an average
price of $46.17 per share. On June 30, approximately $106.1 million
remained of the company's stock repurchase authorization. Table 4
below contains additional information on JOE's repurchase activity
since 1998.
"We continue to view our dividend and repurchase program as an
important contributor to shareholder value," said Corriggio. "During
the first half of 2006, JOE expended an aggregate of $71.6 million for
dividends and the acquisition of its shares toward our 2006 benchmark
of $125 million to $175 million."
SEGMENT RESULTS
ST. JOE TOWNS & RESORTS
Pretax income from continuing operations for St. Joe Towns &
Resorts, JOE's residential and resort development segment, was $19.4
million for the second quarter of 2006, compared to $50.9 million in
the second quarter last year. These results exclude income from
unconsolidated affiliates.
In the second quarter, St. Joe Towns & Resorts closed on the sales
of 424 units and generated revenues from housing and home sites of
$129.2 million, compared to 553 units and $190.9 million,
respectively, in the second quarter of 2005. See Table 5 below for
additional information on our sales activity.
JOE accepted contracts for 224 homes and 43 home sites in the
second quarter of 2006, compared to 500 homes and 146 home sites in
the second quarter last year. See Table 6 below for additional
information on units placed under contract. The decrease is the result
of slowing residential sales in some markets as well as the lack of
inventory at certain projects, particularly SouthWood and Victoria
Park, where temporary permitting and platting delays, now resolved,
limited the availability of home sites.
The backlog of home sites and homes under contract was 572 units
as of June 30, 2006, compared to 1,193 units as of June 30, 2005. As a
result of the slower sales pace in 2006, the backlog continued to be
reduced in the second quarter as closings of units far outpaced units
placed under contract. We are also in a transition stage in several of
our high-volume projects, with Paseos, Rivercrest, St. Johns Golf &
County Club and Artisan Park all nearing sell-out. See Table 7 below
for additional backlog information.
For the second quarter, the average margin for home sites and
homes was 64.2 percent and 23.6 percent, compared to 76.9 percent and
16.2 percent, respectively, for the same period in 2005. The
contraction of home site margins was the result of closing fewer
higher-margin home sites in 2006 at resort communities in Northwest
Florida. The improvement of the home margins was the result of closing
homes sold at higher prices in the strong real estate market over the
past couple of years.
"We are working to further expand our relationships with national
and regional homebuilders and leverage the activity, interest and
energy they bring to a region," said Britt Greene, president of St.
Joe Towns & Resorts and St. Joe Commercial. "We are seeking partners
who think like us and bring new skill sets to JOE's Florida."
Beazer Homes and JOE announced earlier today that the two
companies have entered into a long-term relationship under which JOE
would entitle, develop and sell home sites in a number of its Florida
towns to Beazer Homes, who would build and market the single and
multi-family homes.
Initially, under the terms of several purchase agreements, JOE
will sell Beazer Homes 681 residential single-family, townhouse and
multifamily sites, including 82 townhouse sites in SouthWood in
Tallahassee, 179 single-family sites at Victoria Park in DeLand and
approximately 420 single-family, townhouse and multifamily sites in
Panama City Beach. In addition, JOE has selected a proposal from
Beazer Homes for the purchase of residential sites in RiverTown in St.
Johns County near Jacksonville.
In July, JOE entered into an option agreement with David Weekley
Homes for 70 home sites in ParkPlace and contracted and closed seven
home sites in WaterSound. During the second quarter David Weekley
Homes purchased three home sites in RiverCamps on Crooked Creek, one
of which is intended to be a model home for their marketing efforts.
JOE also selected a proposal from David Weekley Homes for the purchase
of home sites in RiverTown. They had previously contracted and are now
closing home sites in Palmetto Trace in Panama City Beach.
Prior to the second quarter, D.R. Horton had committed to purchase
83 home sites in Hawks Landing.
See Table 8 below for additional information on homebuilder
activity. Significant second quarter project activity is summarized
below. Additional information on project activity is in Table 9 below.
Northwest Florida
WaterColor
In July, the WaterColor Inn was ranked by Travel + Leisure
Magazine as one of the top 4 hotels in the United States in their
rankings of the 'World's Best 100 Hotels.' "Our investment in quality
is paying dividends," said Greene. "This type of recognition should
attract new potential customers."
WaterSound
Sales activity started in the second quarter at WaterSound, north
of U.S. 98 in Walton County. In July, non-binding reservations were
accepted for 19 home sites at an average price of $170,700. With its
inland location and access to beach amenities, WaterSound is bringing
a new product offering to the South Walton County market.
ParkPlace
During the second quarter, David Weekley Homes entered into an
option agreement to purchase 70 home sites in ParkPlace, a new
community in Bay County consisting of 260 residential units on 118
acres.
WindMark Beach
During the second quarter, sales activity started in the new
phases of WindMark Beach in Gulf County. In July, contracts were
accepted for 10 home sites at an average price of $281,600. The
realignment of a 3.5-mile segment of U.S. 98 within WindMark Beach is
scheduled to open late in the third quarter. A show home is featured
in the current issue of Southern Accents magazine.
Northeast Florida
RiverTown
During the second quarter, JOE began construction at RiverTown,
the 4,170-acre primary home community south of Jacksonville in St.
Johns County, one of Florida's fastest growing counties. Proposals for
the purchase of home sites were selected from seven national and
regional homebuilders, including Beazer Homes and David Weekley Homes.
Home sales are expected to begin in 2007.
Southwest Florida
SevenShores
During the second quarter, site work continued at SevenShores in
Bradenton to prepare for this market's selling season that begins in
the fourth quarter of 2006.
North and South Carolina
For the second quarter, Saussy Burbank, JOE's homebuilder based in
Charlotte, NC, accepted contracts for 173 homes, compared to 254
contracts in same quarter last year, which was the highest ever
achieved by Saussy Burbank. "Overall, we continue to see stable
performance from Saussy Burbank in their Carolina markets in Charlotte
and Raleigh that are now in the top five markets in the nation," said
Greene.
COMMERCIAL REAL ESTATE
Pretax income from continuing operations for the commercial
segment was $0.9 million for the second quarter of 2006, compared to
$2.5 million in the same quarter of 2005.
Pretax income from discontinued operations for the second quarter
of 2006 was $4.4 million, compared to $0.3 million in the second
quarter of 2005. Second quarter discontinued operations include the
results of operations and pretax gains of $4.4 million from the sale
of two office buildings in Tampa.
Information on JOE's commercial land sales activity can be found
in Table 10 below. Table 11 contains information on JOE's portfolio of
office buildings.
Northwest Florida
In the second quarter, JOE closed the sale of two multifamily
parcels totaling 17.5 acres in Tallahassee's SouthWood Town Center to
Broad Street Partners for $5.5 million, or $315,000 per acre. This is
JOE's second Broad Street transaction in Northwest Florida. The
mixed-use project is expected to include 383 residential units and
30,000 square feet of retail and commercial space. Current plans call
for the development of 335 rental units and 48 additional condominium
units over the commercial space.
JOE also closed on the sale of a 13.5-acre retail parcel to
Lowe's. The parcel, located on U.S. 98 in Panama City Beach, sold for
$3.3 million, or approximately $245,000 per acre. This retail project
is currently under construction and JOE is marketing the outparcels.
"Demand remains solid for our commerce and business park product,
and we believe we are well positioned for the future, given all the
economic development activity underway in Northwest Florida," said
Greene. "JOE plans to start infrastructure construction later this
quarter on the new Cedar Grove Commerce Park in east Bay County. JOE's
commerce and business parks provide local and regional businesses with
the opportunity to put new operations into service quickly as new jobs
continue to be created in the region."
Investment Portfolio
On June 28, 2006, JOE closed on the sale of Prestige Place One &
Two in Tampa, Florida. The two office buildings, totaling 147,000
square feet, were sold for a gross sales price of $18.1 million, or
$123 per square foot. Originally acquired in December 1999, the pretax
gain on the transaction was $4.4 million.
ST. JOE LAND COMPANY
St. Joe Land Company had a solid second quarter with pretax income
from continuing operations of $23.0 million in the second quarter of
2006, compared to $16.0 million in the second quarter of 2005.
WoodLands
Sales of WoodLands, JOE's rural recreational land, totaled $11.4
million for 5,230 acres at an average price of $2,181 per acre,
compared to $12.1 million for 6,314 acres at an average price of
$1,912 per acre in the second quarter of 2005.
FloridaWild
In the second quarter, JOE worked with the State of Florida and
The Nature Conservancy to complete the sale of 2,590 acres along the
St. Marks River for a new state park. The FloridaWild parcel sold for
$10.6 million, or approximately $4,093 per acre. This parcel is
located south of U.S. 27 in Leon County with a small portion in
Jefferson County.
RiverCamps
RiverCamps on Crooked Creek
In the second quarter, David Weekley Homes purchased three home
sites at an average price of $210,000. David Weekley Home's plans call
for a model home to be started later this year.
WhiteFence Farms
WhiteFence Farms - Red Hills
The 2006 Southern Living and Progressive Farmer Idea House &
Farmstead at WhiteFence Farms - Red Hills opened for public tours on
June 10. The farmstead is being featured in the August 2006 issues of
Southern Living and Progressive Farmer magazines. Sales are expected
to begin in early 2007.
Information on JOE's rural land sales activity can be found in
Table 12 below.
TABLES AND DATA
Table 1 summarizes JOE's Florida residential and mixed-use
projects with land-use entitlements as of June 30, 2006. This table
includes multifamily projects, which are marketed by our commercial
group. Also detailed in the table are commercial entitlements, in
terms of square feet, that are entitled as part of JOE's mixed-use
projects. These commercial entitlements include retail, office and
industrial uses.
Table 1
Summary of Land-Use Entitlements (1)
Active JOE Residential and Mixed-Use Projects in Florida
June 30, 2006
Residential
Units Closed
Project Project Since
Project Class.(2) County Acres Units(3) Inception
------- -------- -------- --------- --------- -----------
In Development: (6)
- -------------------
Artisan Park (7) PR Osceola 175 616 401
Bridgeport PR Gulf 15 37 36
Cutter Ridge PR Franklin 10 25 --
Hawks Landing PR Bay 88 168 23
Landings at Wetappo RR Gulf 113 24 7
Palmetto Trace PR Bay 141 481 441
Paseos (7) PR Palm Beach 175 325 304
RiverCamps on
Crooked Creek RS Bay 1,491 408 181
Rivercrest (7) PR Hillsborough 413 1,382 1,223
RiverSide at
Chipola RR Calhoun 120 10 2
RiverTown PR St. Johns 4,170 4,500 --
SevenShores (Perico
Island) RS Manatee 192 686 --
SouthWood VAR Leon 3,370 4,770 1,944
St. Johns Golf &
Country Club PR St. Johns 820 799 761
SummerCamp RS Franklin 762 499 70
The Hammocks PR Bay 133 457 453
Victoria Park PR Volusia 1,859 4,200 977
WaterColor RS Walton 499 1,140 865
WaterSound VAR Walton 2,425 1,432 7
WaterSound Beach RS Walton 256 511 410
WaterSound West
Beach RS Walton 62 199 13
WindMark Beach RS Gulf 2,020 1,662 104
--------- --------- -----------
Subtotal 19,309 24,331 8,222
--------- --------- -----------
In Pre-Development:(6)
- -------------------
Avenue A PR Gulf 6 96 --
Bayview Estates PR Gulf 31 45 --
Beckrich NE PR Bay 15 70 --
Boggy Creek PR Bay 630 526 --
College Station PR Bay 567 800 --
East Lake Creek PR Bay 81 313 --
East Lake Powell RS Bay 181 360 --
Hills Road RS Bay 30 356 --
Howards Creek RR Gulf 8 33 --
Laguna Beach East PR Bay 25 360 --
Laguna Beach West PR Bay 59 539 --
Long Avenue PR Gulf 10 30 --
Palmetto Bayou PR Bay 58 217 --
ParkPlace PR Bay 118 260 --
ParkSide PR Bay 48 480 --
Pier Park NE VAR Bay 57 460 --
Pier Park Timeshare RS Bay 13 125 --
Port St. Joe Town
Center VAR Gulf 180 624 --
Powell Adams RS Bay 32 1,425 --
RiverCamps on Sandy
Creek RS Bay 6,500 624 --
Sabal Island RS Gulf 45 18 --
The Cove RR Gulf 57 81 --
Timber Island (8) RS Franklin 49 407 --
Topsail VAR Walton 115 627 --
Wavecrest RS Bay 7 95 --
WestBay Corners SE VAR Bay 100 524 --
WestBay Corners SW PR Bay 64 160 --
WestBay DSAP VAR Bay 15,089 5,628 --
WestBay Landing VAR Bay 950 214 --
WhiteFence Farms, RR Leon
Red Hills 373 61 --
--------- --------- -----------
Subtotal 25,498 15,558 --
--------- --------- -----------
Total 44,807 39,889 8,222
========= ========= ===========
Residential
Units Total Remaining
Under Residential Commercial
Contract Units Entitlements
as of Remaining (Sq. Ft.)
Project Class.(2) County 6/30/06(4) (4) (5)
------- -------- -------- --------- ---------- ------------
In Development: (6)
- -------------------
Artisan Park(7) PR Osceola 122 93 --
Bridgeport PR Gulf -- 1 --
Cutter Ridge PR Franklin -- 25 --
Hawks Landing PR Bay 15 130 --
Landings at Wetappo RR Gulf -- 17 --
Palmetto Trace PR Bay -- 40 --
Paseos (7) PR Palm Beach 19 2 --
RiverCamps on
Crooked Creek RS Bay -- 227 --
Rivercrest (7) PR Hillsborough 155 4 --
RiverSide at
Chipola RR Calhoun -- 8 --
RiverTown PR St. Johns -- 4,500 500,000
SevenShores (Perico
Island) RS Manatee 9 677 9,000
SouthWood VAR Leon 76 2,750 5,399,460
St. Johns Golf &
Country Club PR St. Johns 11 27 --
SummerCamp RS Franklin 2 427 25,000
The Hammocks PR Bay 1 3 --
Victoria Park PR Volusia 74 3,149 854,254
WaterColor RS Walton -- 275 47,600
WaterSound VAR Walton -- 1,425 457,380
WaterSound Beach RS Walton 4 97 29,000
WaterSound West RS Walton
Beach -- 186 --
WindMark Beach RS Gulf -- 1,558 75,000
--------- ---------- ------------
Subtotal 488 15,621 7,396,694
--------- ---------- ------------
In Pre-Development:(6)
- -------------------
Avenue A PR Gulf -- 96 --
Bayview Estates PR Gulf -- 45 --
Beckrich NE PR Bay -- 70 --
Boggy Creek PR Bay -- 526 --
College Station PR Bay -- 800 --
East Lake Creek PR Bay -- 313 --
East Lake Powell RS Bay -- 360 --
Hills Road RS Bay -- 356 --
Howards Creek RR Gulf -- 33 --
Laguna Beach East PR Bay -- 360 --
Laguna Beach West PR Bay -- 539 --
Long Avenue PR Gulf -- 30 --
Palmetto Bayou PR Bay -- 217 90,000
ParkPlace PR Bay -- 260 --
ParkSide PR Bay -- 480 --
Pier Park NE VAR Bay -- 460 190,000
Pier Park Timeshare RS Bay -- 125 --
Port St. Joe Town
Center VAR Gulf -- 624 500,000
Powell Adams RS Bay -- 1,425 --
RiverCamps on Sandy
Creek RS Bay -- 624 --
Sabal Island RS Gulf -- 18 --
The Cove RR Gulf -- 81 --
Timber Island (8) RS Franklin -- 407 14,500
Topsail VAR Walton -- 627 300,000
Wavecrest RS Bay -- 95 --
WestBay Corners SE VAR Bay -- 524 50,000
WestBay Corners SW PR Bay -- 160 --
WestBay DSAP VAR Bay -- 5,628 4,330,000
WestBay Landing VAR Bay -- 214 --
WhiteFence Farms,
Red Hills RR Leon -- 61 --
--------- ---------- ------------
Subtotal -- 15,558 5,474,500
--------- ---------- ------------
Total 488 31,179 12,871,194
========= ========== ============
(1) A project is deemed land-use entitled when all major discretionary
governmental land-use approvals have been received. Some of these
projects may require additional permits for development and/or
build-out; they also may be subject to legal challenge.
(2) Current JOE land classifications:
-- PR - Primary residential.
-- RS - Resort and seasonal residential, which includes
RiverCamps.
-- RR - Rural residential, which includes WhiteFence Farms,
Homesteads and other rural residential products.
-- VAR - Includes multiple classifications. For example, a
project may have substantial commercial and residential acres.
(3) Project units represent the maximum number of units entitled or
currently expected at full build-out. The actual number of units
or square feet to be constructed at full build-out may be lower
than the number entitled or currently expected.
(4) Excludes our Mid-Atlantic region that includes activity in North
and South Carolina where we are primarily engaged in homebuilding,
and not obtaining entitlements. As of June 30, 2006, the
Mid-Atlantic region had 1,793 home sites owned or under contract.
Of that total, 258 have been sold and 1,535 remain to be sold.
(5) Represents the remaining square feet with land-use entitlements as
designated in a development order or expected given the existing
property land use or zoning and present plans. Commercial
entitlements include retail, office and industrial uses.
Industrial uses total 6,128,381 square feet including SouthWood,
RiverTown and the West Bay DSAP.
(6) A project is "in development" when construction on the project has
commenced. A project in "pre-development" has land-use
entitlements but is still under internal evaluation or requires
one or more additional permits prior to the commencement of
construction.
(7) Artisan Park is 74 percent owned by JOE. Paseos and Rivercrest
are each 50 percent owned by JOE.
(8) Timber Island entitlements include seven residential units and 400
units for hotel or other transient uses (including units held with
fractional ownership such as private residence clubs) and include
480 wet/dry marina slips.
Table 2 details the proposed JOE residential and mixed-use
projects in the land-use entitlements process in Florida.
Table 2
Proposed JOE Residential and Mixed-Use Projects
In the Land-Use Entitlement Process in Florida (1)
June 30, 2006
Estimated
Estimated Commercial
Project Project Entitlements
Project Class.(2) County Acres Units(3) (Sq. Ft.)(3)
------- -------- -------- --------- --------- ------------
Bayview MF PR Gulf 20 300 --
BonfireBeach RS Bay 550 750 70,000
Breakfast Point VAR Bay 1,448 3,100 635,000
Carrabelle East PR Franklin 200 600 --
DeerPoint Cedar
Grove PR Bay 599 750 --
PineLog RR Bay 1,300 125 --
SouthSide VAR Leon 1,625 2,800 1,150,000
South Walton
Multifamily PR Walton 40 212 --
Star Avenue North VAR Bay 271 1,248 380,000
St. James Island
McIntyre RR Franklin 1,704 340 --
St. James Island
RiverCamps RS Franklin 2,500 500 --
St. James Island
Granite Point RS Franklin 1,000 2,000 --
--------- --------- ------------
Total 11,257 12,725 2,235,000
========= ========= ============
(1) A project is deemed to be in the land-use entitlement process when
customary steps necessary for the preparation and submittal of an
application, such as conducting pre-application meetings or
similar discussions with governmental officials, have commenced
and/or an application has been filed. All projects listed have
significant entitlement steps remaining that could affect their
timing, scale and viability. There can be no assurance that these
entitlements will ultimately be received.
(2) Current JOE land classifications:
-- PR - Primary residential.
-- RS - Resort and seasonal residential, which includes
RiverCamps.
-- RR - Rural residential, which includes WhiteFence Farms,
Homesteads and other rural residential products.
-- VAR - Includes multiple classifications. For example, a
project may have substantial commercial and residential acres.
(3) The actual number of units or square feet to be constructed at
full build-out may be lower than the number ultimately entitled.
Table 3 is a summary of the additional commercial land-use
entitlements.
Table 3
Summary of Additional Commercial Land-Use Entitlements (1)
(Commercial Projects Not Included in Tables 1 and 2 Above)
Active JOE Florida Commercial Projects
June 30, 2006
Acres Under
Acres Sold Contract
Project Since As of Total Acres
Project County Acres Inception 6/30/06 Remaining
------- -------- ------- ---------- ---------- -----------
Airport Commerce Leon 45 -- -- 45
Alf Coleman Retail Bay 25 15 1 9
Avery St. Retail Bay 10 -- -- 10
Beach Commerce Bay 157 141 6 10
Beach Commerce II Bay 112 11 -- 101
Beckrich Office Park Bay 12 8 -- 4
Beckrich Retail Bay 47 18 -- 29
Cedar Grove Commerce Bay 51 -- -- 51
Glades Retail Bay 14 -- -- 14
Gulf Boulevard Bay 76 21 -- 55
Hammock Creek
Commerce Gadsden 165 27 -- 138
Mill Creek Commerce Bay 37 -- -- 37
Nautilus Court Bay 11 4 -- 7
Port St. Joe
Commerce II Gulf 39 9 -- 30
Port St. Joe
Commerce III Gulf 54 -- -- 54
Port St. Joe Medical Gulf 19 -- -- 19
Powell Hills Retail Bay 44 -- 44 --
South Walton Commerce Walton 39 15 -- 24
------- ---------- ---------- -----------
Total 957 269 51 637
======= ========== ========== ===========
(1) A project is deemed land-use entitled when all major discretionary
governmental land-use approvals have been received. Some of these
projects may require additional permits for development and/or
build-out; they also may be subject to legal challenge. Includes
significant JOE projects that are either operating, under
development or in the pre-development stage.
Table 4 summarizes the company's stock repurchase activity from
1998 through June 30, 2006.
Table 4
Stock Repurchase Activity
Through June 30, 2006
Shares
---------------------------------------
Total Cost Average
Period Purchased Surrendered(1) Total (in millions) Price
------ ----------- ------------- ----------- ----------- --------
1998 2,574,200 11,890 2,586,090 $55.5 $21.41
1999 2,843,200 11,890 2,855,090 69.5 24.31
2000 3,517,066 -- 3,517,066 80.2 22.78
2001 7,071,300 58,550 7,129,850 176.0 24.67
2002 5,169,906 256,729 5,426,635 157.6 29.03
2003 2,555,174 812,802 3,367,976 102.9 30.55
2004 1,561,565 884,633 2,446,198 105.0 42.90
2005 1,705,000 68,648 1,773,648 124.8 70.33
2006
(through
June 30) 900,100 4,596 904,696 47.7 52.69
----------- ------------- ----------- ----------- --------
Total/
Weighted
Average 27,897,511 2,109,738 30,007,249 $919.3 $30.61
=========== ============= =========== =========== ========
(1) Shares surrendered by company executives as payment for the strike
price and taxes due on exercised stock options and the vesting of
restricted stock.
Tables 5 and 6 summarize sales activity for St. Joe Towns &
Resorts for the second quarter of 2006 compared to the same period in
2005. Table 7 details backlog for St. Joe Towns and Resorts.
Table 5
St. Joe Towns & Resorts
Sales Activity
For the Three Months
Ended June 30,
($ in millions)
2006 2005
----------------------------- -----------------------------
Number Number
of Cost of of Cost of
Units Sales Gross Units Sales Gross
Closed Revenue (1) Profit Closed Revenue (1) Profit
------ ------- ------- ------ ------ ------- ------- ------
Home Sites
(2) 40 $7.0 $2.5 $4.5 120 $52.7 $12.2 $40.5
Homes (3) 384 122.2 93.3 28.9 433 138.2 115.8 22.4
------ ------- ------- ------ ------ ------- ------- -----
Total 424 $129.2 $95.8 $33.4 553 $190.9 $128.0 $62.9
====== ======= ======= ====== ====== ======= ======= ======
(1) Cost of sales for home sites in the second quarter of 2006
consisted of $1.8 million in direct costs, $0.2 million in selling
costs and $0.5 million in indirect costs. Cost of sales for home
sites in the second quarter of 2005 consisted of $9.4 million in
direct costs, $1.7 million in selling costs and $1.1 million in
indirect costs. Cost of sales for homes in the second quarter of
2006 consisted of $79.5 million in direct costs, $6.1 million in
selling costs and $7.7 million in indirect costs. Cost of sales
for homes in the second quarter of 2005 consisted of $98.7 million
in direct costs, $7.4 million in selling costs and $9.7 million in
indirect costs.
(2) Profit has been deferred as a result of continuing development
obligations at SummerCamp and WaterSound West Beach. As a
consequence, revenue recognition and closings may occur in
different periods.
(3) Homes include single-family, multifamily and Private Resident
Club (PRC) units. Multifamily and PRC revenue is recognized, if
preconditions are met, on a percentage-of-completion basis. As a
consequence, revenue recognition and closings may occur in
different periods. Percentage-of-completion accounting was
utilized at Artisan Park in the second quarter of 2006 and Artisan
Park, WaterColor and WaterSound Beach in the second quarter of
2005. Paseos and Rivercrest, two joint ventures 50 percent owned
by JOE, are not included. Sales are substantially complete at both
of these communities.
Table 6
St. Joe Towns & Resorts
Units Placed Under Contract
For the Three Months
Ended June 30,
2006 2005 Percentage Change
-------- -------- -------------------
Home Sites 43 146 (70.5)%
Homes (1) 224 500 (55.2)
-------- -------- -------------------
Total (1) 267 646 (58.7)%
======== ======== ===================
(1) Homes include single-family homes, multifamily and PRC units.
Paseos and Rivercrest, two unconsolidated joint ventures, are not
included. Sales are substantially complete at both of these
communities.
Table 7
St. Joe Towns & Resorts
Backlog (1)
($ in millions)
June 30, 2006 June 30, 2005
------------------- --------------------
Units Revenues Units Revenues
--------- --------- --------- ----------
Home Sites 18 $1.7 36 $3.2
Homes (2) 554 207.4 1,157 420.6
--------- --------- --------- ----------
Total 572 $209.1 1,193 $423.8
========= ========= ========= ==========
(1) Backlog represents units under contract but not yet closed. Paseos
and Rivercrest, two joint ventures 50 percent owned by JOE, are
not included. Backlog at Paseos and Rivercrest totaled $44.8
million for 174 units at the end of the second quarter of 2006,
compared to $178.9 million for 726 units at the end of the second
quarter of 2005.
(2) As of June 30, 2006, there were 95 units subject to
percentage-of-completion accounting in the homes backlog with
related revenue of $44.9 million (of which $38.4 million had
previously been recognized in the financial statements). As of
June 30, 2005, there were 212 units subject to
percentage-of-completion accounting with related revenue of
$77.1 million (of which $38.6 million had previously been
recognized in the financial statements).
Table 8 summarizes commitments for home site purchases from
national homebuilders.
Table 8
National Homebuilder Summary
As of July 31, 2006
Total Units Total Units Average Price Remaining Units
Committed(1) Closed to Date Closed Units To Close(2)
------------ -------------- ------------- ---------------
Beazer Homes
Beckrich
Northeast 70 0 N/A 70
Laguna Beach
West 350 0 N/A 350
SouthWood 82 0 N/A 82
Victoria Park 179 0 N/A 179
David Weekley
Homes
Palmetto Trace 55 31 76,200 24
ParkPlace 70 0 N/A 70
RiverCamps
on Crooked
Creek 3 3 210,000 0
WaterSound 7 7 $144,200 0
D.R. Horton
Hawks Landing 83 0 N/A 83
----------- -------------- ---------------
Total 899 41 858
=========== ============== ===============
(1) Includes amounts under contract or under option.
(2) These units are not included in the data on Tables 6 and 7.
Table 9 summarizes the sales activity at various residential
communities for the second quarter of 2006 compared to the same period
in 2005.
Table 9
St. Joe Towns & Resorts
Sales Activity
For the Three Months Ended June 30,
($ in thousands)
2006 2005
Units Avg. Accepted Units Avg. Accepted
Closed Price (1) Price Closed Price (1) Price
------ ------- ------- ------- ------ ------- ------- -------
WaterColor
Home
Sites 1 $321.4 1 $321.4 36 $544.6 36 $544.60
Single/
Multi-
family
Homes 1 840.7 0 0 2 735.7 0 0
WaterSound
Beach
Home
Sites 0 0 0 0 24 1,020.2 24 1,020.2
Single-
Family
Homes 1 1,038.0 4 1,124.2 0 0 0 0
WaterSound-
West Beach
Home
Sites 2 293.9 2 293.9 0 0 0 0
WaterSound
Home
Sites 7 144.2 7 144.2 0 0 0 0
Palmetto
Trace
Home
Sites 8 78.0 8 78.0 0 0 0 0
Single-
Family
Homes 26 320.1 2 201.0 31 188.6 26 301.6
The
Hammocks
Single-
Family
Homes 19 154.2 0 0 19 191.2 25 143.7
Hawks
Landing
Home
Sites 0 0 15 76.7 0 0 0 0
Bridgeport
Home
Sites 5 23.8 0 0 0 0 5 21.2
SouthWood
Home
Sites 6 118.3 (1) (52.0) 22 130.2 25 132.2
Single-
Family
Homes 41 312.7 3 358.5 58 259.1 65 290.7
SummerCamp
Home
Sites 5 350.4 5 325.8 0 0 0 0
Single-
Family
Homes 0 0 0 0 0 0 0 0
St. Johns
G & CC
Home
Sites 0 0 2 157.5 12 64.7 35 70.2
Single-
Family
Homes 17 535.1 8 510.0 39 402.6 15 471.1
Hampton
Park/James
Island
Single-
Family
Homes 0 0 0 0 4 511.8 1 499.9
Victoria
Park
Home
Sites 6 170.6 4 137.2 21 139.3 16 138.8
Single-
Family
Homes 50 306.9 18 354.8 87 270.3 67 305.1
Artisan
Park(2)
Home
Sites 0 0 0 .0 5 447.0 5 447.0
Single-
Family
Homes 27 642.3 2 494.5 18 432.3 25 661.0
Multi-
family
Homes 49 396.1 5 441.9 0 0 22 487.4
SevenShores
Multi-
family
Homes 0 0 9 1,013.7 0 0 0 0
Paseos(2)
Single-
Family
Homes 26 504.2 0 0 35 435.7 0 0
Rivercrest
(2)
Single-
Family
Homes 81 209.0 0 0 138 160.8 98 213.1
Saussy
Burbank
Single-
Family
Homes 153 283.4 173 281.8 175 256.0 254 245.8
------ ------- ------- ------- ------ ------- ------- -------
Total 531 $313.9 267 $313.3 726 $289.5 744 $300.2
------ ------- ======= ======= ====== ======= ======= =======
(1) Contracts accepted during the quarter. Contracts accepted and
closed in the same quarter are also included as units closed.
Average prices shown reflect variations in the product mix across
time periods as well as price changes for similar product.
(2) JOE owns 74 percent of Artisan Park and 50 percent of each of
Paseos and Rivercrest. Sales from Paseos and Rivercrest are not
consolidated with the financial results of St. Joe Towns &
Resorts.
Table 10 summarizes JOE's commercial land sales in Northwest
Florida for the second quarters of 2006 and 2005.
Table 10
St. Joe Commercial Northwest Florida Land Sales
Quarter Ended June 30,
Number of Gross Sales Price Average Price/Acre
Sales Acres Sold (in thousands) (in thousands)
--------- ---------- ----------------- --------------------
2006 5 34 $9,509 $282
2005 11 25 $2,933 $116
Table 11 summarizes JOE's investment property portfolio of office
buildings as of June 30, 2006.
Table 11
Investment Portfolio of Office Buildings
June 30, 2006
Number of Net Rentable Leased
Location Properties Square Feet Percentage
-------- ---------- ------------ ------------
Florida 6 609,000 89%
Georgia 8 1,289,000 76
North Carolina 1 158,000 100
Virginia 3 354,000 96
---------- ------------ ------------
Total 18 2,410,000 84%
========== ============ ============
Table 12 summarizes JOE's rural land sales in Northwest Florida
for the second quarters of 2006 and 2005.
Table 12
St. Joe Land Company Rural Land Sales
Quarter Ended June 30,
Number of Gross Sales Price Average Price/Acre
Sales Acres Sold (in thousands) (in thousands)
--------- ---------- ----------------- --------------------
2006
WoodLands 19 5,230 $11,409 $2,181
FloridaWild 2 2,910 12,478 4,288
Other 2 269 2,541 9,446
--------- ---------- ----------------- --------------------
Total 23 8,409 26,428 3,143
========= ========== ================= ====================
2005
WoodLands 27 6,314 12,075 1,912
Homesteads 19 159 1,781 11,200
Other 1 7 460 65,714
--------- ---------- ----------------- --------------------
Total 47 6,480 $14,316 $2,209
========= ========== ================= ====================
FINANCIAL DATA
($ in millions except per share amounts)
Summary Balance Sheet
June 30, 2006 December 31, 2005
----------------- -----------------
Assets
Investment in real estate $1,192.9 $1,036.2
Cash and cash equivalents 43.5 202.6
Accounts receivable 60.2 58.9
Prepaid pension asset 97.0 95.0
Property, plant and equipment, net 37.7 40.2
Other assets 140.5 159.0
----------------- -----------------
Total assets $1,571.8 $1,591.9
================= =================
Liabilities and Stockholders'
Equity
Debt $ 605.3 $ 554.4
Accounts payable, accrued
liabilities 239.7 214.4
Deferred income taxes 257.9 315.9
----------------- -----------------
Total liabilities 1,102.9 1,084.7
Minority interest 17.1 18.2
Total stockholders' equity 451.8 489.0
----------------- -----------------
Total liabilities and stockholders'
equity $1,571.8 $1,591.9
================= =================
Debt Schedule
June 30, 2006 December 31, 2005
----------------- -----------------
Revolving debt facility $ 50.0 $ --
Medium term notes 407.0 407.0
Acquisition and other debt 4.0 14.7
Other collateralized/specific asset
related debt 144.3 132.7
----------------- -----------------
Total debt $ 605.3 $ 554.4
================= =================
Consolidated Quarterly Comparisons
Quarter Ended June 30, Six Months Ended June 30,
------------------------- -------------------------
2006 2005 2006 2005
------------ ------------ ------------ ------------
Revenues:
Real estate sales $163.6 228.3 $302.7 $386.9
Rental revenue 10.7 9.8 22.2 19.1
Timber sales 7.8 7.6 16.3 15.6
Other revenues 12.6 14.0 20.2 22.2
------------ ------------ ------------ ------------
Total revenues 194.7 259.7 361.4 443.8
------------ ------------ ------------ ------------
Expenses:
Cost of real
estate sales 101.2 142.6 194.8 247.5
Cost of rental
revenue 4.5 3.9 8.8 7.5
Cost of timber
sales 6.4 4.9 12.2 10.1
Cost of other
revenues 12.2 11.8 20.2 19.8
Other operating
expenses 18.2 17.5 38.4 33.2
Corporate expense,
net 13.6 12.0 29.3 23.9
Depreciation and
amortization 9.7 9.2 20.0 18.5
------------ ------------ ------------ ------------
Total expenses 165.8 201.9 323.7 360.5
------------ ------------ ------------ ------------
Operating profit 28.9 57.8 37.7 83.3
Other income
(expense) (1.9) (2.2) (5.4) (3.2)
------------ ------------ ------------ ------------
Pretax income from
continuing
operations 27.0 55.6 32.3 80.1
Income tax expense (10.7) (22.3) (13.1) (32.0)
Minority interest
expense (2.7) (1.1) (4.9) (2.0)
Equity in income of
unconsolidated
affiliates 2.7 5.5 5.6 7.4
Discontinued
operations, net
of tax 2.7 0.2 2.8 (0.2)
------------ ------------ ------------ ------------
Net income $19.0 $37.9 $22.7 $53.3
============ ============ ============ ============
Net income per
diluted share $0.25 $0.50 $0.30 $0.70
============ ============ ============ ============
Weighted average
diluted shares
outstanding 74,540,823 76,502,088 74,740,791 76,601,786
============ ============ ============ ============
Quarterly Revenues by Segment
Quarter Ended June 30, Six Months Ended June 30,
------------------------- -------------------------
2006 2005 2006 2005
------------ ------------ ------------ ------------
Towns & Resorts:
Real estate sales $129.3 $190.9 $248.1 $319.9
Rental revenue 0.5 0.5 0.8 0.6
Other revenues 12.4 13.9 19.8 21.9
------------ ------------ ------------ ------------
Total Towns &
Resorts 142.2 205.3 268.7 342.4
------------ ------------ ------------ ------------
Commercial real estate:
Real estate sales 5.2 14.0 8.1 25.7
Rental revenue 10.2 9.2 21.4 18.5
Other revenues 0.2 0.1 0.3 0.3
------------ ------------ ------------ ------------
Total Commercial
real estate 15.6 23.3 29.8 44.5
------------ ------------ ------------ ------------
Land Sales:
Real estate sales 29.1 23.5 46.6 41.3
------------ ------------ ------------ ------------
Total Land sales 29.1 23.5 46.6 41.3
------------ ------------ ------------ ------------
Forestry sales 7.8 7.6 16.3 15.6
------------ ------------ ------------ ------------
Total revenues $194.7 $259.7 $361.4 $443.8
============ ============ ============ ============
Quarterly Segment Pretax Income
From Continuing Operations
Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
2006 2006 2005 2005 2005 2005 2004 2004 2004
------ ------ ------ ------ ------ ------ ------ ------ ------
Towns &
Resorts $19.4 $11.7 $37.5 $25.6 $50.9 $23.1 $24.7 $31.8 $34.4
Commercial
real
estate 0.9 0.1 4.9 14.2 2.5 1.2 17.0 2.8 1.0
Land
sales 23.0 11.8 24.2 16.6 16.0 12.0 16.3 11.5 10.3
Forestry 0.9 2.0 0.5 0.6 1.6 2.0 2.1 1.9 2.4
Corporate
and
other (17.2) (20.3) (15.0) (16.1) (15.4) (13.8) (17.0) (13.6) (11.9)
------ ------ ------ ------ ------ ------ ------ ------ ------
Pretax
income
from
continuing
oper-
ations $27.0 $5.3 $52.1 $40.9 $55.6 $24.5 $43.1 $34.4 $36.2
====== ====== ====== ====== ====== ====== ====== ====== ======
Other Income (Expense)
Quarter Ended June 30, Six Months Ended June 30,
------------------------- -------------------------
2006 2005 2006 2005
------------ ------------ ------------ ------------
Dividend and
interest income $1.1 $0.3 $3.0 $0.6
Interest expense (5.0) (3.4) (8.7) (5.7)
Other 2.0 0.9 0.3 1.9
------------ ------------ ----------- ------------
Total $(1.9) $(2.2) $(5.4) $(3.2)
============ ============ =========== ============
Equity in Income of Unconsolidated Affiliates
Quarter Ended June 30, Six Months Ended June 30,
------------------------- -------------------------
2006 2005 2006 2005
------------ ------------ ------------ ------------
Commercial $ -- $2.4 $ -- $2.4
Towns & Resorts 2.7 3.1 5.6 5.0
------------ ------------ ----------- ------------
Total $2.7 $5.5 $5.6 $7.4
============ ============ =========== ============
Reported results are preliminary and not final until the filing of
our Form 10-Q with the SEC and, therefore, remain subject to
adjustment.
Conference Call Information
JOE will host an interactive conference call to review the
Company's results for the quarter ended June 30, 2006, and to discuss
earnings guidance for 2006 on Tuesday, August 1, 2006, at 10:30 a.m.,
Eastern Daylight Time.
To participate in the call, please phone 877-502-9276 (for
domestic calls from the United States) or 913-981-5591 (for
international calls) approximately ten minutes before the scheduled
start time. You may be asked for a Confirmation Code which is:
3277453. Approximately three hours following the call, you may access
a replay of the call by phoning 888-203-1112 (domestic) or
719-457-0820 (international) using access code 3277453. The replay
will be available for one week.
JOE will also web cast the conference call live over the internet
in a listen-only format. Listeners can participate by visiting the
Company's web site at http://www.joe.com. Access will be available 15
minutes prior to the scheduled start time. A replay of the conference
call will be posted to the JOE web site approximately three hours
following the call. The replay of the call will be available for one
week.
About JOE
The St. Joe Company (NYSE:JOE), a publicly held company based in
Jacksonville, is one of Florida's largest real estate operating
companies. We are primarily engaged in real estate development and
sales, with significant interests in timber. JOE's mission is to
create places that inspire people and make the region an even better
place to live, work and play. We're no ordinary JOE.
More information about JOE can be found at our web site at
http://www.joe.com.
Forward-Looking Statements
We have made forward-looking statements in this earnings release,
particularly in the Outlook Section, pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Any statements in this release that are not historical facts are
forward-looking statements. You can find many of these forward-looking
statements by looking for words such as "intend", "anticipate",
"believe", "estimate", "expect", "plan", "should", "forecast" or
similar expressions. In particular, forward-looking statements
include, among others, statements about the following:
-- future operating performance, revenues, earnings, cash flows,
and short and long-term revenue and earnings growth rates;
-- the size and number of residential units and commercial
buildings;
-- expected development timetables and projected timing for the
second sales or closings of homes or home sites in a
community;
-- development approvals and the ability to obtain such
approvals, including possible legal challenges;
-- the anticipated price ranges of developments;
-- the number of units or commercial square footage that can be
supported upon full build out of a development;
-- the number, price and timing of anticipated land sales or
acquisitions;
-- estimated land holdings for a particular use within a specific
time frame;
-- absorption rates and expected gains on land and home site
sales;
-- the pace at which we release new products for sale;
-- comparisons to historical projects;
-- the amount of dividends we pay; and
-- the number of shares of company stock which may be purchased
under the company's existing or future share-repurchase
program.
Forward-looking statements are not guarantees of future
performance. You are cautioned not to place undue reliance on any of
these forward-looking statements. These statements are made as of the
date hereof based on our current expectations, and we undertake no
obligation to update the information contained in this release. New
information, future events or risks may cause the forward-looking
events we discuss in this earnings release not to occur.
Forward-looking statements are subject to numerous assumptions,
risks and uncertainties. Factors that could cause actual results to
differ materially from those contemplated by a forward-looking
statement include the risk factors described in our annual report on
Form 10-K for the year ended December 31, 2005 as well as, among
others, the following:
-- economic conditions, particularly in Northwest Florida,
Florida as a whole and key areas of the southeast United
States that serve as feeder markets to our Northwest Florida
operations;
-- changes in the demographics affecting projected population
growth in Florida, including the demographic migration of Baby
Boomers;
-- changes in macro-economic perceptions or conditions in the
real estate market;
-- the termination of sales contracts or letters of intent due
to, among other factors, the failure of one or more closing
conditions or market changes;
-- whether our developments receive all land-use entitlements or
other permits necessary for development and/or full build-out
or are subject to legal challenge;
-- local conditions such as the supply of homes and home sites
and residential or resort properties or a change in the demand
for real estate in an area;
-- timing and costs associated with property developments and
rentals;
-- the pace of commercial development in Northwest Florida;
-- competition from other real estate developers;
-- changes in pricing of our products and changes in the related
profit margins;
-- changes in operating costs, including real estate taxes and
the cost of construction materials;
-- changes in the amount or timing of federal and state income
tax liabilities resulting from either a change in our
application of tax laws, an adverse determination by a taxing
authority or court, or legislative changes to existing laws;
-- changes in interest rates and the performance of the financial
markets;
-- changes in market rental rates for our commercial and resort
properties;
-- changes in the prices or availability of wood products;
-- the pace of development of public infrastructure, particularly
in Northwest Florida, including a proposed new airport in Bay
County, which is dependent on approvals of the local airport
authority and the Federal Aviation Administration, various
permits and the availability of adequate funding;
-- potential liability under environmental laws or other laws or
regulations;
-- changes in laws, regulations or the regulatory environment
affecting the development of real estate;
-- fluctuations in the size and number of transactions from
period to period;
-- natural disasters, including hurricanes and other severe
weather conditions, and the impact on current and future
demand for our products in Florida;
-- the continuing effects of recent hurricane disasters on the
regional and national economies and current and future demand
for our products in Florida;
-- the prices and availability of labor and building materials;
-- changes in insurance rates and deductibles for property in
Florida;
-- changes in gasoline prices; and
-- acts of war, terrorism or other geopolitical events.
The foregoing list is not exhaustive and should be read in
conjunction with other cautionary statements contained in our periodic
and other filings with the Securities and Exchange Commission.
(C) 2006, The St. Joe Company. "St. Joe," "JOE," "Artisan Park,"
"Paseos," "Pier Park," "RiverCamps," "RiverTown," "SouthWood,"
"SummerCamp," "Victoria Park," "WaterColor," "WaterSound," "WhiteFence
Farms," "WindMark," and the "Taking Flight" design are service marks
of The St. Joe Company. "Southern Living" is a registered trademark of
Southern Living, Inc. "Southern Accents" is a registered trademark of
Southern Accents, Inc. "Progressive Farmer" is a registered trademark
of Progressive Farmer, Inc. "Travel + Leisure" is a registered
trademark of American Express Publishing Corporation.
CONTACT: The St. Joe Company, Jacksonville
JOE Media Contact: Jerry M. Ray, 904-301-4430
jray@joe.com
or
JOE Investor Contact: Brad Slappey, 904-301-4302
bslappey@joe.com