Press Release: The St. Joe Company
January 7, 2002
JACKSONVILLE, FL -- The St. Joe Company (NYSE:JOE) announced Friday that it expects its fourth quarter 2001 EBITDA
per share, excluding gains on conservation land sales, to meet or exceed the upper end of prior expectations of
$0.43 to $0.48 per share. EBITDA from conservation land sales in the fourth quarter is expected to be approximately
$0.04 per share.
For the full year 2001, the company expects EBITDA of $1.64, or more, per share, excluding gains on conservation
land sales. For the full year of 2001, the company expects to report EBITDA from conservation land sales of approximately
$0.26 per share.
``St. Joe had another great year in 2001, providing shareholders with a total return of 26.6 percent,'' said Peter
S. Rummell, chairman and CEO of St. Joe. ``That performance demonstrates the benefits of our unique advantages
- from our low-basis, high-quality land to our strong balance sheet. We expect to continue to capitalize on these
advantages in 2002 and beyond.''
``Our focus on execution continues to create value,'' said Kevin M. Twomey, president and COO of St. Joe. ``Our
projections for 2002 are based on the assumption that the current economic situation will continue - with neither
a major recovery, nor any further weakening of the economy. In that light, we expect to advance our core strategies
in 2002, achieve significant progress in building value for our holdings in Florida's Great Northwest and deliver
excellent results for shareholders.''
OUTLOOK FOR 2002
In 2002, the company expects EBITDA per share, excluding gains from conservation land sales, to increase by approximately
10 percent. Net income, excluding gains on conservation land sales, for the full year 2002 is expected to be approximately
$1.80 to $1.85 per share. Net income projections include a non-cash contribution of approximately $1.10 per share,
relating to the gain on the forward sale of equity securities previously disclosed in the company's fourth quarter
earnings release dated February 9, 2000.
Highlights, by major business unit, are as follows:
Community Residential Real Estate
``EBITDA for Arvida Community Development is projected to increase approximately 10 percent, or more, over 2001,''
said Rummell. ``These results reflect continued solid progress at WaterColor, a near tripling of the contribution
from WaterSound, and contributions from a number of primary home communities such as James Island, St. John's Golf
and Country Club, SouthWood and Victoria Park.''
``Importantly, the growing performance of new Arvida communities occurs as the contribution from our highly successful
investment in the Arvida/JMB partnership substantially winds up by year-end 2002,'' said Rummell. ``Contributions
from the Arvida/JMB partnership in 2002 are expected to be approximately half of what they were last year.''
``We expect to achieve important progress in planning and entitlement of resort communities in Gulf, Bay and Franklin
Counties in Northwest Florida, although they will not contribute to 2002 earnings,'' said Rummell. ``This progress,
even without the continuing income from the Arvida/JMB partnership, will position the company for solid earnings
growth in 2003 and beyond.''
Arvida Realty Services
Despite a more difficult environment, Arvida Realty Services expects to improve EBITDA by approximately 5 percent,
or more, in 2002.
Commercial Real Estate
``St. Joe Commercial had a great year in 2001 with gains of $4.5 million in the second quarter from the sale of
the NCCI building and $5.7 million in the fourth quarter from the sale of the IBM building,'' said Twomey. ``As
previously discussed, St. Joe is no longer pursuing build-to-suit projects outside our primary markets and, as
a result, this income will not be replaced in 2002 and beyond. During 2002 St. Joe Commercial will continue to
focus on the development and sale of retail and commercial properties in Florida's Great Northwest. We expect St.
Joe Commercial EBITDA to be flat or up modestly compared with 2001, even without income from transactions such
as the NCCI and IBM projects.''
Investment Properties
``St. Joe continues to acquire multi-tenant buildings through our strategy to defer taxes on land sale gains,''
said Twomey. ``This source of lease income is expected to grow and become a more meaningful and stable element
of our ongoing performance. These buildings produced approximately $9.0 million EBITDA in 2001. This source of
income should increase by approximately 70 percent in 2002. With the completion of the purchase of an office building
in Washington, D.C. on December 27, 2001, the company has acquired over 1.1 million square feet of buildings through
this program. We expect to continue to grow this investment and source of income.''
St. Joe Land Company
``We are delighted with the progress and prospects of the St. Joe Land Company,'' said Rummell. ``St. Joe Land
recorded EBITDA of over $40 million in both 2000 and 2001, exceeding expectations in both years largely as a result
of several major transactions. In 2001, St. Joe Land made significant progress supplementing the gains from large
transactions with smaller transactions, an important step toward becoming a more retail-oriented business at excellent
per-acre prices.''
St. Joe Land is also working to build future sources of earnings through two major initiatives. The first, RiverCamps,
is expected to be a contributor to income in 2003. The second, a five-year program now underway to seek additional
entitlements and zoning improvements throughout its land holdings. ``For 2002, we expect continued good results,
although without the benefit of a current projection of as many large parcel sales as occurred in prior years,''
said Twomey. ``Therefore, we are projecting EBITDA for St. Joe Land in the low $30 million range.''
``Again in 2002, we are working to deliver the best possible results and beat these projections,'' said Rummell.
``St. Joe Land starts 2002 with a stronger book of contracts than ever.''
St. Joe Timberland Company
The principal strategy for St. Joe Timberland Company is to build value by enhancing the value of land for use
by the residential, commercial and St. Joe Land divisions of the company, and by growing and selling timber products
to others. ``During 2002, we expect Timberland EBITDA to be about even with 2001, with a run-rate of about $3 million
per quarter,'' said Twomey. ``Aside from meeting timber obligations under existing supply contracts, we do not
intend to aggressively sell timber in this depressed market. We'll just let more timber grow, build value and sell
it in a better market.''
Conservation Land Sales
``We have activity underway to sell additional parcels of conservation land totaling over 150,000 acres,'' said
Twomey. ``Timing of these sales is uncertain, but we anticipate completing most of these sales by the end of 2003.
We are optimistic that conservation land sales will continue to be a significant contributor in 2002.''
STOCK REPURCHASE PROGRAM
During the fourth quarter of 2001, the company repurchased a total of 948,200 shares.
In 2001, St. Joe repurchased 7,071,300 shares at an average price of $24.68 per share. That represents approximately
8.4 percent of the outstanding shares on December 31, 2000.
At December 31, 2001, the company had 79,509,608 shares outstanding, of which 46,674,300 shares were held by the
Alfred I. duPont Testamentary Trust, the majority stockholder of the company or the Trust's primary beneficiary,
The Nemours Foundation.
The company's final results for the fourth quarter and full year 2001 will be reported before the opening of the
New York Stock Exchange on February 6, 2002.
The St. Joe Company, a publicly held company based in Jacksonville, is Florida's largest real estate operating
company. It is engaged in community, commercial, industrial, hospitality, leisure and resort development, along
with residential and commercial real estate services. The company also has significant interests in timber.
More information about St. Joe can be found at our web site at http://www.joe.com.
Forward-Looking Statements
Certain matters discussed in this press release are ``forward-looking statements'' within the meaning of the Private
Securities Litigation Reform Act of 1995. Some matters involve risk and uncertainty, and there can be no assurance
that the results described in such forward-looking statements will be realized. In particular, discussions regarding
the size and number of commercial buildings, residential units, development timetables, development approvals and
the ability to obtain approvals, anticipated price ranges of developments, the number of units that can be supported
upon full build-out of development, the number and price of anticipated land sales, and the absorption rate and
expected gain on land sales and statements concerning future operating performance and short- and long-term revenue
and earnings growth rates and comparisons to historical projects are forward-looking statements. Such statements
are based on current expectations and are subject to certain risks. Should one or more of these risks or uncertainties
materialize or should the underlying assumptions prove incorrect, the company's actual performance may differ materially
from that indicated or suggested by any forward-looking statement contained herein. Additional risk factors that
may cause actual results to differ materially from those expressed in forward-looking statements contained in the
press release are described in various documents filed by the company with the U.S. Securities and Exchange Commission,
including the company's Annual Report on Form 10-K for the year ended December 31, 2000.
Copyright 2002, The St. Joe Company. ``WaterColor,'' ``WaterSound,'' and the ``taking flight'' logo are service
marks of The St. Joe Company. Arvida is a registered trademark.
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Contact:
The St. Joe Company, Jacksonville
Media: Jerry M. Ray, 904/858-2707
or Investor Contact: Steve Swartz, 904/858-5295