~~In April 2015, the FASB issued Accounting Standard Update 2015-03,~~~~“Simplifying the Presentation of Debt Issuance Costs”~~ ("ASU 2015-03"). Upon adoption, ASU 2015-03 will require debt issuance costs associated with outstanding term debt to be presented in the balance sheet as a direct reduction in the carrying value of the associated debt liability, consistent with the current presentation of a debt discount. For fees paid to lenders to secure revolving lines of credit, such fees will continue to be presented as a deferred charge (asset) on the balance sheet. Under current guidance prior to ASU 2015-03, all debt issuance costs, for both term debt and revolving lines of credit, are presented in the balance sheet as a deferred charge (asset). ASU 2015-03 is limited to the presentation of debt issuance costs and will not affect the recognition and measurement of debt issuance costs. Upon adoption, ASU 2015-03 must be applied on a retrospective basis and is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted. Since ASU 2015-03 involves balance sheet presentation only, its adoption will not have any impact on the Company's results of operations, financial condition, or cash flows. The Company is evaluating a decision to early adopt ASU 2015-03 prior to its mandatory effective date.

~~Simplified Measurement Date for Defined Benefit Plan Assets and Obligations~~

~~In April 2015, the FASB issued Accounting Standard Update 2015-04, “~~~~Practical Expedient for the Measurement Date of an Employer's Defined Benefit Obligation and Plan Assets”~~ ("ASU 2015-04"). Upon adoption, ASU 2015-04 will allow employers with fiscal year ends that do not coincide with a calendar month end to make an accounting policy election to measure defined benefit plan assets and obligations as of the end of the month closest to their fiscal year ends (i.e., on an alternative measurement date). An employer that makes this election must consistently apply the practical expedient from year to year and to all of its defined benefit plans. ASU 2015-04 will be effective for interim and fiscal periods beginning after December 15, 2015; prospective application is required and early adoption is permitted. The Company's fiscal year end is September 30 and the Company has a defined retirement plan. The Company is currently evaluating the policy election that will be allowed upon the adoption of ASU 2015-04.

~~In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2014-09,~~~~“Revenue from Contracts with Customers” (Topic 606)~~, which clarifies the principles for recognizing revenue. The guidance is applicable to all contracts with customers regardless of industry-specific or transaction-specific fact patterns. Further, the guidance requires improved disclosures as well as additional disclosures to help users of financial statements better understand the nature, amount, timing, and uncertainty of revenue that is recognized. The standard is effective for the Company beginning in the first quarter of fiscal 2018, including interim periods within that first fiscal year, and early adoption is now permitted for 2017. Upon becoming effective, the Company will apply the amendments in the updated standard either retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application. The Company is currently evaluating the impact of adopting this standard on its consolidated financial position, results of operations, and cash flows.

Certain prior year amounts have been reclassified in the accompanying Financial Statements for consistent presentation to the current period. These reclassifications had no impact on working capital, net income, ~~stockholders’~~ equity or cash flows as previously reported.

The Company manages its land based upon its primary usage and reviews its performance based upon two primary classifications – Orange Co. and Conservation and Environmental Resources. Other Operations include leasing mines, oil extraction rights to third parties and leasing activity on our improved farmlands. The Company presents its financial results and the related discussions based upon these three segments (Orange Co., Conservation and Environmental Resources and Other Operations). In the first quarter of fiscal year 2016, the Company has realigned its financial reporting segments to match its internal operations.

References to U.S. GAAP in this Quarterly Report on Form 10-Q are to the Financial Accounting Standards Board, Accounting Standards Codification.

In November 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-17, "Balance Sheet Classification of Deferred Taxes" ("ASU 2015-17"), which will require entities to present all deferred tax liabilities and assets as noncurrent on the balance sheet instead of separating deferred taxes into current and noncurrent amounts. The standard is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods. Early application is permitted. The standard can be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. As this standard impacts presentation only, the adoption of ASU 2015-17 is not expected to have an impact on the Company's financial condition, results of operations and cash flows.

In January 2016, the FASB issued ASU 2016-01. “Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”). This guidance retains the current accounting for classifying and measuring investments in debt securities and loans, but requires equity investments to be measured at fair value with subsequent changes recognized in net income, except for those accounted for under the equity method or requiring consolidation. The guidance also changes the accounting for investments without a readily determinable fair value and that do not qualify for the practical expedient to estimate fair value. A policy election can be made for these investments whereby estimated fair value may be measured at cost and adjusted in subsequent periods for any impairment or changes in observable prices of identical or similar investments. We are currently evaluating the impact this guidance will have on our consolidated financial statements and it will become effective for us at the beginning of our first quarter of fiscal 2019.

The Company is primarily engaged in the production of fruit for sale to citrus markets, which is of a seasonal nature and subject to the influence of natural phenomena and wide price fluctuations. Historically, the second and third quarters of our fiscal year generally produce the majority of our annual revenue, and our working capital requirements are typically greater in the first and fourth quarters of our fiscal year. The results of the reported periods herein are not necessarily indicative of the results for any other interim periods or the entire fiscal year.

Property ~~buildings~~ and equipment, net ~~consist~~consists of (~~in thousands~~):

June 30, September 30,
2015 2014

Breeding herd $ 11,158 $ 11,558
Buildings 21,377 16,282
Citrus trees 243,878 69,952
Equipment and other facilities 59,464 55,799

Total depreciable assets 335,877 153,591
Less: accumulated depreciation and depletion (75,324 ) (66,321 )

Net depreciable assets 260,553 87,270
Land and land improvements 122,547 39,563

Total property, buildings and equipment, net $ 383,100 $ 126,833

~~Land Sale~~

~~Certain Silver Nip Citrus land with a cost of $2,832,159 was classified as held for sale as of~~the following at December 31, 2015 and September 30, ~~2014. It was sold during the nine months ended June 30, 2015 resulting in a gain on sale of assets of $2,926,553.~~

~~Asset Impairment~~

The Company recorded an impairment loss of approximately $541,000 during the nine months ended June 30, 2015 on property classified as assets held for sale as of September 30, 2014. The Company entered into a sales contract on February 17, 2015, which triggered the impairment of the property based on the negotiated sales price. The property was sold on April 3, 2015 and the Company received approximately $1,509,000 in net sales proceeds.

2015:



(in thousands)	December 31,			September 30,
	2015			2015
Citrus trees	$	248,408		$	247,488
Equipment and other facilities	57,439			56,200
Buildings and improvements	21,262			21,259
Breeding herd	12,464			11,924
Total depreciable properties	339,573			336,871
Less accumulated depreciation and depletion	(73,959		)	(70,200		)
Net depreciable properties	265,614			266,671
Land and land improvements	114,493			114,428
Net property and equipment	$	380,107		$	381,099

Note 4. Acquisitions and Dispositions

Acquisition of Orange-Co

On December 2, 2014, the Company completed the acquisition of certain citrus and related assets of Orange-Co, LP (“Orange-Co”) pursuant to an Asset Purchase Agreement, which we refer to as the Orange-Co Purchase Agreement, dated as of December 1, 2014 and 51% of the ownership interests of ~~Citree.~~Citree Holdings 1, LLC ("Citree"). The assets the Company purchased include approximately 20,263 acres of citrus groves in DeSoto and Charlotte Counties, Florida, which comprise one of the largest contiguous citrus grove properties in the state of Florida. Total assets acquired were approximately $277,792,000, net of $2,060,000 in cash acquired and approximately $4,838,000 in fair value attributable to noncontrolling interest in Citree, including: ~~(1)~~(i) $147,500,000 in initial cash consideration funded from the proceeds of the sugarcane disposition and new term loan debt; ~~(2)~~(ii) up to $7,500,000 in additional cash consideration to be released from escrow in equal parts, subject to certain limitations, on December 1, 2015 and June 1, 2016; ~~(3)~~(iii) the refinancing of Orange-Co’s outstanding debt including approximately $92,290,000 in term loan debt and a working capital facility of approximately $27,857,000 and ~~(4)~~(iv) the assumption of certain other liabilities totaling approximately $4,705,000. On December 1, 2014, Alico deposited an irrevocable standby letter of credit issued by Rabo Agrifinance, Inc.~~, or Rabo,~~ in the aggregate amount of $7,500,000 into an escrow account to fund the additional cash consideration.

~~The Company acquired~~ On December 1, 2015, we paid $3,750,000 of additional consideration on the Orange-Co ~~to transform our citrus business~~acquisition as contemplated by the Orange-Co Purchase Agreement. Our $7,500,000 irrevocable letter of credit securing the payment of the additional consideration expired and ~~meaningfully enhance the Company’s position~~was replaced with a new letter of credit in the ~~citrus industry. The Company has included~~amount of $3,750,000 securing the ~~financial results of Orange-Co in the Financial Statements from the date of acquisition. These results include approximately $72,233,000 in revenue and $18,060,000 in gross profit.~~

final payment due on June 1, 2016 subject to certain limitations.

This acquisition was accounted for under the acquisition method of accounting. Accordingly, the Company recognized amounts for identifiable assets acquired and liabilities assumed at their estimated acquisition date fair values, while transaction and integration costs associated with the acquisition were expensed as incurred. The excess of the purchase price over the fair value of assets acquired, net of liabilities assumed, and noncontrolling interests is recognized as goodwill. All goodwill recognized will be deductible for income tax purposes. ~~The~~

On the acquisition date, the initial accounting for the business combination iswas not complete and adjustments to provisional amounts, or recognition of additional assets acquired or liabilities assumed, may occur as more detailed analyses are completed and additional information is obtained about the facts and circumstances that existed as of the acquisition date. In the Company’s Condensed Combined Consolidated Financial Statements for the period ended June 30, 2015, the total assets acquired and liabilities assumed were based on preliminary information and were subject to adjustment as new information was obtained. ~~During~~As a result of refinements to the ~~three months ended June 30, 2015,~~preliminary purchase price allocation, an adjustment to the fair value of total assets acquired resulted in an increase of approximately ~~$1,000,000.~~

$1,000,000 during the fiscal year ended September 30, 2015.

For the ~~nine~~three months ended ~~June 30, 2015,~~December 31, 2014 the Company incurred approximately ~~$3,239,000~~$2,579,000 in professional and legal costs in connection with the Orange-Co acquisition. These costs are included in ~~corporate,~~ general and administrative expenses in the Condensed Combined Consolidated Statements of Operations and Comprehensive ~~Income for the nine months ended June 30, 2015.~~

Income.

The following table summarizes the ~~consideration paid for the acquired net assets and~~final allocation of the acquisition ~~accounting for the fair values of~~cost to the assets acquired and liabilities assumed ~~as adjusted, in~~at the ~~Condensed Combined Consolidated Balance Sheets as~~date of ~~the~~ acquisition, ~~date. These balances are subject to change when final asset valuations are obtained and the potential for liabilities has been further evaluated.~~

~~The fair value of the consideration paid for the acquisition of the net assets, as adjusted, was as follows:~~

Asset acquisition
(in thousands)
Amount
Assets:
Accounts receivable, net $ 888
Other current assets 845
Inventories, net 35,562
Property, Buildings and Equipment 240,949
Goodwill 2,246
Other assets 2,140
Total assets, net of cash acquired $ 282,630

Liabilities:
Accounts payable and accrued liabilities $ 4,205
Debt 500
Payable to seller 7,500
Total liabilities assumed $ 12,205

Assets acquired less liabilities assumed $ 270,425

Less: fair value attributable to noncontrolling interest (4,838 )

Total purchase consideration $ 265,587

Cash proceeds from sugarcane disposition $ 97,126
Working capital line of credit 27,857
Term loans 140,604

Total purchase consideration $ 265,587

The unaudited pro-forma information below for the three and nine months ended June 30, 2015 and 2014 gives effect to this acquisition as if the acquisitions had occurred on October 1, 2013. The pro-forma financial information is not necessarily indicative of the results of operations if the acquisition had been effective as of this date.

(in thousands except per share amounts) Three Months Ended June 30, Nine Months Ended June 30,
2015 2014 2015 2014

Revenues $ 68,809 $ 73,519 $ 131,857 $ 163,375
Income from operations $ 16,177 $ 20,479 $ 18,438 $ 38,119
Net income attributable to Alico, Inc. common stockholders $ 7,767 $ 11,843 $ 15,104 $ 20,932
Basic earnings per common share $ 0.94 $ 1.61 $ 1.90 $ 2.86
Diluted earnings per common share $ 0.94 $ 1.61 $ 1.89 $ 2.85

~~Acquisition of Citrus Grove~~

On September 4, 2014, Silver Nip Citrus and TRB Groves, LLC entered into a Purchase and Sale Agreement pursuant to which Silver Nip Citrus purchased all of the assets on a 1,500 acre citrus grove in Charlotte County, FL for a purchase price of approximately $17,624,000. The purchase price was funded from Silver Nip Citrus’ cash and cash equivalents and $11,000,000 in term loans (see “Note 7” to the accompanying Condensed Combined Consolidated Financial Statements). ~~We acquired the citrus acres to increase the size of our citrus groves which we believe strengthens our market position.~~

~~The total cost of the acquisition was allocated to the assets acquired~~ based on their estimated ~~respective~~ fair ~~values in accordance with ASC 805, Business Combinations and was accounted for using the acquisition method of accounting.~~

The results of operations have been included in our combined consolidated statements of operations since September 4, 2014, the date of closing. Pro-forma operating results, as if the Company had completed the acquisition at the beginning of the periods presented, are not significant to the Company’s consolidated financial statements and are not presented.

~~Assets acquired in the acquisition are as follows:~~

(in thousands)
Amount
Assets:
Inventories, net $ 1,329
Property, Buildings and Equipment
Equipment and other facilities 2,742
Land 5,921
Citrus Trees 7,632
Total assets, net of cash acquired $ 17,624

values:

��

7

Asset acquisition
(in thousands)
Amount
Assets:
Accounts receivable $ 888
Other current assets 845
Inventories 35,562
Property and equipment
Citrus Trees 164,123
Land 63,395
Equipment and other facilities 13,431
Goodwill 2,246
Other assets 2,140
Total assets, net of cash acquired $ 282,630

Liabilities:
Accounts payable and accrued liabilities $ 4,205
Debt 500
Contingent consideration 7,500
Total liabilities assumed $ 12,205

Assets acquired less liabilities assumed $ 270,425

Less: fair value attributable to noncontrolling interest (4,838 )

Total purchase consideration $ 265,587

Cash proceeds from sugarcane disposition $ 97,126
Working capital line of credit 27,857
Term loans 140,604

Total purchase consideration $ 265,587

Sugarcane Land

On November 21, 2014, the Company completed the sale of approximately 36,000 acres of land used for sugarcane production and land leasing in Hendry County, Florida to Global Ag Properties, LLC (“~~Global Ag Properties”~~Global”) for approximately $97,900,000 in cash. We had previously leased approximately 30,600 of these acres to United States Sugar Corporation ~~(“USSC”)~~ (the “USSC Lease”). The USSC Lease was assigned to Global ~~Ag Properties~~ in conjunction with the land sale.

Net cash proceeds from the sugarcane land sale of approximately $97,126,000 were deposited with a Qualified Intermediary in anticipation of the Orange-Co asset acquisition in a tax deferred like-kind exchange pursuant to Internal Revenue Code Section ~~§1031.~~

1031.

The sales price is subject to post-closing adjustments over a ten (10)-year period. The Company realized a gain of approximately $42,753,000 on the sale. Initially, $29,140,000 of the gain was deferred due to the Company’s continuing involvement in the property pursuant to a post-closing agreement and the potential price adjustments. The deferral represents the Company’s estimate of the maximum exposure to loss as a result of the continuing involvement. A net gain of approximately$~~13,613,000~~ $13,613,000 was recognized on the sale and is recognized in Other income (expense) in the Condensed Combined Consolidated ~~Statement~~Statements of Operations and Comprehensive Income for the ~~nine~~three months ended ~~June 30, 2015.~~

December 31, 2014.

On May 1, 2015, the Company made a payment of $1,347,000 to Global ~~Ag Properties~~ pursuant to the sales contract. USSC’s ~~rent~~lease is tied to the market price of sugar, and this payment is required annually in advance, to supplement the ~~rent~~lease paid by USSC in the event that the sugar prices are below certain thresholds. ~~This advance~~Approximately $610,000 of this payment is included in prepaid expenses and

other current assets ~~at June 30,~~in the Condensed Combined Consolidated Balance Sheet as of December 31, 2015 and the Company has recognized $364,029 in interest expense and $10,614 of the deferred gain for the three months ended December 31, 2015.

As a result of the disposition of our sugarcane land, we are no longer involved in sugarcane operations and, as of November 21, 2014, the Improved Farmland segment was no longer material to our business, however, the sugarcane operation has not been classified as a discontinued operation due to the post-closing adjustments, amongst other involvement, as described above.

Effective October 1, 2015, Improved Farmland is now included in the Other Operations reporting segment.

Note 5. Common Control Acquisition

The Company completed the Merger with Silver Nip Citrus on February 28, 2015 (see ~~“Note 1” to the accompanying Condensed Combined Consolidated Financial Statements)~~Note 1, “Basis of Presentation - Description of Business”). Silver Nip Citrus owns approximately ~~7,434~~7,400 acres of land, consisting primarily of citrus groves, in ~~six~~seven Florida counties (Polk, Hardee, Osceola, Martin, Highlands, Charlotte and Collier). Substantially all of its revenues derive from citrus operations. As the Company and Silver Nip Citrus were under common control at the time of the Merger, we have combined the ~~operating~~ results of operations of the Company and Silver Nip Citrus from the date common control ~~began.~~

The Company’s results of operations for the three and nine months ended June 30, 2015 include the Silver Nip Citrus results of operations for the three and nine months ended March 31, 2015. The Company’s results of operations for the three and nine months ended June 30, 2014 include the Silver Nip Citrus results of operations frombegan, November 19, ~~2013 (the initial date of common control) through March 31, 2014.~~

2013.

Separate results for the Company and Silver Nip Citrus for the three ~~and nine~~ months ended ~~June 30, 2015 and~~December 31, 2014 ~~were~~are as ~~follows :~~

(in thousands except for per share amounts) Three Months Ended June 30, 2015 Three Months Ended June 30, 2014
Silver Nip Silver Nip
Alico Citrus Total Alico Citrus Total

Operating revenues $ 61,007 $ 7,802 $ 68,809 $ 28,675 $ 5,200 $ 33,875

Gross profit $ 18,090 $ 1,725 $ 19,815 $ 3,739 $ 854 $ 4,593

Net income $ 6,727 $ 1,040 $ 7,767 $ 1,119 $ (88 ) $ 1,031

Comprehensive income $ 6,727 $ 1,040 $ 7,767 $ 1,119 $ (88 ) $ 1,031

Earnings per common share:
Basic $ 0.81 $ 0.13 $ 0.94 $ 0.15 $ (0.01 ) $ 0.14
Diluted $ 0.81 $ 0.13 $ 0.94 $ 0.15 $ (0.01 ) $ 0.14

(in thousands except for per share amounts) Nine Months Ended June 30, 2015 Nine Months Ended June 30, 2014
Silver Nip Silver Nip
Alico Citrus Total Alico Citrus Total

Operating revenues $ 129,375 $ 10,734 $ 140,109 $ 81,139 $ 8,367 $ 89,506

Gross profit $ 31,185 $ 1,805 $ 32,990 $ 15,593 $ 1,770 $ 17,363

Net income $ 15,866 $ 2,426 $ 18,292 $ 4,485 $ 538 $ 5,023

Comprehensive income $ 15,866 $ 2,426 $ 18,292 $ 4,485 $ 538 $ 5,023

Earnings per common share:
Basic $ 1.99 $ 0.30 $ 2.30 $ 0.61 $ 0.07 $ 0.69
Diluted $ 1.99 $ 0.30 $ 2.29 $ 0.61 $ 0.07 $ 0.68

follows:



(in thousands except per share amounts)
	Three Months Ended December 31, 2014
				Silver Nip
	Alico			Citrus			Total

Operating revenue	$	16,158		$	2,912		$	19,070
Gross profit	$	3,144		$	128		$	3,272
Loss from operations	$	(2,286	)	$	74		$	(2,212	)
Net income	$	5,775		$	(569	)	$	5,206

Earnings per common share:
Basic	$	0.78		$	(0.08	)	$	0.71
Diluted	$	0.78		$	(0.08	)	$	0.71

Note 6. ~~Income Taxes~~

Income tax expense was approximately $6,227,000 and $791,000 for the three months ended June 30, 2015 and 2014, respectively. The Company’s effective income tax rates were 44.5% and 43.4% for the three months ended June 30, 2015 and 2014, respectively. Income tax expense was approximately $10,940,000 and $3,236,000 for the nine months ended June 30, 2015 and 2014, respectively. The Company’s effective income tax rates for the nine months ended June 30, 2015 and 2014 were 37.4% and 39.2%, respectively.

During the three months ended June 30, 2015, the Company revised its effective tax rates to reflect the impact of claiming certain deductions on amended federal and state income tax returns filed in prior fiscal years. Other changes to the effective tax rates relate primarily to the nondeductible nature of projected political contributions and lobbying expenses. In addition, there were limitations on certain deductions related to the vesting of the long-term incentive grants for fiscal year 2014, and non-deductible transaction costs related to the Silver Nip Citrus merger for fiscal year 2015.

The Company applies a “more likely than not” threshold to the recognition and nonrecognition of tax positions. A change in judgment related to prior years’ tax positions is recognized in the quarter of such change. The Company had no reserve for uncertain tax positions as of June 30, 2015 and September 30, 2014. The Company recognizes interest and/or penalties related to income tax matters in income tax expense and in income taxes payable.

~~The Internal Revenue Service (“IRS”) is currently auditing Alico’s tax returns for the fiscal years ended September 30, 2013, 2012 and 2011.~~

~~Note 7.~~ Long-Term Debt and Lines of Credit

December 31, September 30,
2015 2015
(in thousands)
Long-term debt, net of current portion:
Metropolitan Life Insurance Company and New England Life Insurance Company fixed rate term loans in the original principal amount of $125,000,000: the loans bear interest at the rate of 4.15% per annum as of December 31, 2015. The loans are collateralized by real estate and mature in November 2029. $ 110,000
$ 111,563
Metropolitan Life Insurance Company and New England Life Insurance Company variable rate term loans in the original principal amounts of $57,500,000: the variable interest rate was approximately 1.82% per annum as of December 31, 2015. The loans are collateralized by real estate and mature in November 2029. 54,625
55,344
Metropolitan Life Insurance Company term loan: the loan bears interest at the rate of 5.30% per annum as of December 31, 2015. A final advance of $2,500,000 is scheduled for March 1, 2016 subject to certain performance conditions. The interest rate is subject to adjustment on the date of the final advance. The loan is collateralized by real estate and matures in February 2029. 2,500
2,500
Prudential Mortgage Capital Company, LLC fixed rate term loans: the loans bear interest at the rate of 5.35% per annum as of December 31, 2015. The loans are collateralized by real estate and mature in June 2033. 25,060
25,350
Prudential Mortgage Capital Company, LLC fixed rate term loan: the loan bears interest at the rate of 3.85% per annum as of December 31, 2015. The loan is collateralized by real estate and matures in September 2021. 5,280
5,335
Prudential Mortgage Capital Company, LLC fixed rate term loan: the loan bears interest at the rate of 3.45% per annum as of December 31, 2015. The loan is collateralized by real estate and matures in September 2039. 5,280
5,335
Note payable to a financing company collateralized by equipment and maturing in December 2016. 36
54
202,781
205,481
Less current portion 4,511
4,511
Long-term debt $ 198,270
$ 200,970

December 31, September 30,
2015 2015
(in thousands)
Lines of Credit:
Metropolitan Life Insurance Company and New England Life Insurance Company revolving line of credit: this $25,000,000 line bears interest at a variable rate which was 1.82% per annum as of December 31, 2015. The line is collateralized by real estate and matures in November 2019. $ —
$ —
Rabo Agrifinance, Inc. working capital line of credit: this $70,000,000 line bears interest at a variable rate which was 1.99% per annum as of December 31, 2015. The line is collateralized by current assets and certain personal property and matures in November 2016. Availability under the line was approximately $30,884,000 as of December 31, 2015. 25,132
—
Lines of Credit $ 25,132
$ —

10

Future maturities of debt and lines of credit as of December 31, 2015 are as follows:
(in thousands)

Due within one year $ 4,643
Due between one and two years 8,225
Due between two and three years 10,825
Due between three and four years 35,925
Due between four and five years 10,975
Due beyond five years 157,320

Total future maturities $ 227,913

Debt Refinancing ~~on December 3, 2014~~

The Company refinanced its outstanding debt obligations on December 3, 2014 in connection with the Orange-Co acquisition (see ~~“Note 4” to the accompanying Condensed Combined Consolidated Financial Statements)~~Note 4 “Acquisitions and Dispositions”). The ~~debt~~new credit facilities ~~include $113,125,000~~initially included $125,000,000 in fixed interest rate term loans, ~~$56,063,000~~$57,500,000 in variable interest rate term loans and a $25,000,000 revolving line of credit (“RLOC”) with Metropolitan Life Insurance Company and New England Life Insurance Company (collectively “Met”) and a $70,000,000 working capital line of credit (“WCLC”) with Rabo Agrifinance, Inc. (“Rabo”).

The new term loans and RLOC are secured by approximately ~~38,700~~39,300 gross acres of citrus groves and 14,000 gross acres of farmland. The WCLC is secured by the Company’s current assets and certain other personal property owned by the Company.

The new term loans are subject to quarterly principal payments of $2,281,250 and mature November 1, 2029. The fixed rate term loans bear interest at 4.15% per annum, and the variable rate term loans bear interest at a rate equal to 90 day LIBOR plus 150 basis points (the “LIBOR spread”). The LIBOR spread is subject to adjustment by the lender on May 1, 2017 and every two years ~~thereafter.~~thereafter until maturity. Interest on the term loans is payable quarterly.

The interest rate on the variable rate term loans was 1.82% per annum as of December 31, 2015. The loans are collateralized by certain real estate of the Company.

The Company may prepay up to $8,750,000 of the fixed rate term loan principal annually without penalty, and any such prepayments ~~shall~~may be applied to reduce subsequent mandatory principal payments. The maximum annual prepayment ~~has been~~was made for calendar year 2015 and remains available to reduce future mandatory principal payments when the ~~current fiscal year.~~Company elects to do so. The variable rate term loans may be prepaid without penalty.

The RLOC bears interest at a floating rate equal to 90 day LIBOR plus 150 basis points payable quarterly. The LIBOR spread is subject to adjustment by the lender on May 1, 2017 and every two years thereafter. Outstanding principal, if any, is due at maturity on November 1, 2019. The RLOC is subject to an annual commitment fee of 25 basis points on the unused portion of the ~~line.~~line of credit. The RLOC is available for funding general corporate needs.

The variable interest rate was 1.82% per annum as of December 31, 2015. The RLOC was available as of December 3, 2014 but has remained undrawn as of December 31, 2015.

The WCLC is a revolving credit facility and is available for funding working capital and general corporate ~~needs.~~requirements. The interest rate on the WCLC is based on the one month LIBOR plus a spread. The spread is adjusted quarterly based on our debt service coverage ratio for the preceding quarter and can vary from 175 to 250 basis points. The rate is currently at LIBOR plus 175 basis points. The variable interest rate was 1.99% per annum as of December 31, 2015. The WCLC facility matures November 1, 2016.

Availability under the line of credit was approximately $30,884,000 as of December 31, 2015.

The WCLC is subject to a quarterly commitment fee on the daily unused availability under the line computed as the commitment amount less the aggregate of the outstanding loans and outstanding letters of credit. The commitment fee is adjusted quarterly based on our debt service coverage ratio for the preceding quarter and can vary from a minimum of 20 basis points to a maximum of 30 basis points.

The WCLC agreement provides for Rabo to issue up to $20,000,000 in letters of credit on the Company’s behalf. As of ~~June 30,~~December 31, 2015, there was ~~$17,498,500~~approximately $13,984,000 in outstanding letters of credit which correspondingly reduced our availability under the line of credit.

The outstanding balance on the WCLC was approximately $25,132,000 as of December 31, 2015. On January

19, 2016, $25,000,000 was transferred from the WCLC to the RLOC and has been classified as non-current at December 31, 2015 in accordance with FASB ASC 470-10, "Debt." The remaining $132,000 balance on the WCLC has been classified as a current liability at December 31, 2015.

The Company capitalized approximately $2,834,000 of debt financing costs ~~and~~related to the refinancing. These costs, together with approximately $339,000 of costs related to the retired debt, will be amortized to interest expense over the applicable terms of the loans. The unamortized balance of deferred financing costs related to the financing was approximately $2,360,000 at December 31, 2015.

The Company recognized a loss on extinguishment of debt of approximately ~~$585,000. Deferred financing costs are capitalized and amortized~~$947,000 related to ~~interest expense over~~ the ~~applicable term of~~refinancing for the ~~loan. The capitalized deferred debt financing costs are included in other assets in the Condensed Combined Consolidated Balance Sheet as of June 30, 2015.~~three months ended December 31, 2014. The loss on extinguishment of debt is included in ~~other~~Other income (expense)~~, net~~ in the Condensed Combined Consolidated Statement of Operations and Comprehensive Income for the ~~nine~~three months ended ~~June 30, 2015.~~

December 31, 2014.

The new credit facilities noted above are subject to various covenants including the following financial covenants: ~~(1)~~(i) minimum debt service coverage ratio of 1.10 to 1.00, ~~(2)~~(ii) tangible net worth of at least $160,000,000 increased annually by 10% of consolidated net income for the preceding year, ~~(3)~~or approximately $161,576,000 for the year ending September 30, 2016, (iii) minimum current ratio of 1.50 to 1.00, ~~(4)~~(iv) debt to total assets ratio not greater than .625 to 1.00, and, solely in the case of the WCLC, ~~(5)~~(v) a limit on capital expenditures of $30,000,000 per fiscal year. ~~The~~As of December 31, 2015, the Company was in compliance with all ~~covenants as~~ of ~~June 30, 2015.~~

~~Debt Prior to Refinancing~~

~~Prior to~~ the ~~December 3, 2014 refinancing, the Company had~~financial covenants.

The credit facilities also include a ~~$34,000,000~~Met Life term loan ~~and~~secured by real estate owned by Citree. This is a ~~$60,000,000 revolving line of~~$5,000,000 credit ~~(“Old RLOC”) with Rabo.~~

~~The term loan required quarterly payments of~~facility that initially bore interest at ~~a floating rate~~5.49% per annum. An initial advance of ~~one month LIBOR plus 225 basis points~~$500,000 was made at closing on March 4, 2014. The loan agreement was amended to provide for an interim advance of $2,000,000 on September 17, 2015, and ~~quarterly principal payments of $500,000. The term loan was refinanced in connection with~~ the ~~Orange-Co acquisition.~~

~~The Old RLOC had an~~ interest rate ~~based on one month LIBOR plus a spread. The spread~~ was ~~determined based upon our debt service coverage ratio for the preceding fiscal year and could vary from 195~~adjusted to 295 basis points. The rate was LIBOR plus 195 basis points at the date of the refinancing and September 30, 2014. Interest on the Old RLOC was payable quarterly. The Old RLOC was subject to an unused commitment fee of 20 basis points on the annual average unused availability. There was no balance outstanding5.30% per annum at the time of the ~~refinancing or September 30, 2014.~~

~~Debt financing costs incurred as a result of entry into~~interim advance. The amendment extended the Rabo credit facility loan agreement, including appraisal fees, document stamps, legal costs and lender fees of approximately $1,202,000 were capitalized in fiscal year ended September 30, 2010 and were being amortized to interest expense over the termdate of the ~~loan.~~final $2,500,000 advance from December 1, 2015 to March 1, 2016. The interest rate is subject to further adjustment at the time of the final advance. The loan matures in February 2029. The unamortized balance of ~~the~~ deferred financing costs related to this loan was approximately $56,131 at ~~the time of~~ December 3, 2014 refinancing were approximately $697,000 of which approximately $375,000 was written off and expensed as a loss on extinguishment of debt and approximately $301,000 will be amortized over the applicable terms of the new loans.

~~At September 30, 2014, the Company was in compliance with the financial debt covenants and terms of the Rabo loan agreement.~~

31, 2015.

Silver Nip Citrus Debt

Silver Nip Citrus has various loans payable to Prudential Mortgage Capital Company, LLC (“Prudential”) as described below.

There are two fixed rate term loans with ~~total outstanding balances~~an original combined balance of ~~$25,930,000 and~~ $27,550,000, bearing interest at ~~March 31, 2015 and June 30, 2014, respectively.~~5.35% per annum. Principal of $290,000 is payable ~~quarterly. Interest accrues at 5.35% per annum and is also payable quarterly.~~quarterly together with accrued interest. The Company may prepay up to $5,000,000 of principal without penalty. On February 15, 2015, Silver Nip Citrus made a prepayment of $750,000. The loans are ~~secured~~collateralized by real estate in Collier, Hardee, ~~Hendry,~~ Highlands, Martin, Osceola and Polk Counties, Florida.

~~In connection~~

Silver Nip Citrus entered into two fixed rate term loans with Prudential to finance the ~~purchase~~acquisition of a 1,500 ~~acres of~~acre citrus grove on September 4, ~~2014 (see “Note 4” to the Condensed Combined Consolidated Financial Statements) Silver Nip Citrus has a fixed rate term~~2014. Each loan ~~with Prudential with an outstanding balance of $5,445,000 as of March 31, 2015 that bears interest at the rate of 3.85% per annum. Principal~~was in the original amount of $5,500,000. Principal of $55,000 per loan is payable quarterly together with accrued interest. ~~The loans are secured by real estate in Charlotte County, Florida.~~

~~Silver Nip Citrus also has a fixed rate term~~One loan ~~with Prudential with an outstanding balance of $5,445,000 at March 31, 2015 that~~ bears interest at 3.85% per annum while the ~~rate of~~other bears interest at 3.45% per annum. The note with an interest rate of 3.85% per annum is subject to adjustment on September 1, 2019 and every ~~five years~~year thereafter until maturity. ~~Principal of $55,000 is payable quarterly together with accrued interest. The loan is secured~~Both loans are collateralized by real estate in Charlotte County, Florida.

Silver Nip Citrus had a $6,000,000 revolving line of credit with Prudential. ~~Outstanding balances were $3,348,000~~This line of credit was paid in full and ~~$3,160,000~~terminated on April 28, 2015.

The unamortized balance of deferred financing costs related to the Silver Nip Citrus debt was approximately $372,000 at ~~March~~December 31, 2015 and June 30, 2014, respectively. The interest rate on the line is based on the three month LIBOR rate plus 275 basis points. Interest is payable semi-annually with outstanding principal due at maturity.

2015.

The Silver Nip Citrus facilities are subject to a financial debt covenant requiring a current ratio of at least ~~2.00~~1.50 to 1.00 measured at the end of each fiscal year. ~~The Company~~Silver Nip Citrus was in compliance with ~~all covenants related to the Silver Nip debt at March 31, 2015 and~~this covenant as of June 30, ~~2014.~~

2015, the most recent measurement date.

The Silver Nip Citrus facilities are personally guaranteed by George Brokaw, Remy Trafelet and Clayton ~~Wilson.~~

Wilson.

Modification of Credit Agreements

~~The Silver Nip Citrus line of credit with Prudential was paid in full and terminated on April 28, 2015.~~

Rabo ~~has~~ agreed, subject to certain conditions, that the Company may loan Silver Nip Citrus up to $7,000,000 on a revolving basis. These advances would be funded from either cash on hand or draws on the Company’s ~~WCLC.~~

WCLC, for cash management purposes.

Silver Nip Citrus has provided a $7,000,000 limited guaranty and security agreement granting Rabo a security interest in crops, accounts receivable, inventory and certain other assets.

This modification required the amendment of various Prudential and Rabo loan documents and mortgages.

~~Outstanding debt obligations under the Company’s various loan agreements is presented in the tables below:~~

(in thousands)
June 30, September 30,
2015 2014

Long-term debt, net of current portion:
Metropolitan Life Insurance Company and New England Life Insurance Company fixed rate term loans in the original principal amount of $125 million:  the loans bear interest at the rate of 4.15% per annum as of June 30, 2015. The loans are collateralized by real estate and mature in November 2029. $ 113,125 $ -

Metropolitan Life Insurance Company and New England Life Insurance Company variable rate term loans in the original principal amounts of $57.5 million:  the variable interest rate was 1.78% per annum as of June 30, 2015.  The loans are collateralized by real estate and mature in November 2029. 56,063 -

Metropolitan Life Insurance Company term loan:  the loan bears interest at the initial rate of 5.49% per annum as of June 30, 2015.  A final advance of $4.5 million is scheduled for December 1, 2015 subject to certain performance conditions.  The interest rate is subject to adjustment on the date of the final advance.  The loan is secured by real estate and matures in February 2029. 500 -

Rabo Agrifinance, Inc. variable rate term loan:  the variable interest rate on this loan was 2.40% per annum as of September 30, 2014. The loan was secured by real estate and had a maturity date of October 2020.  The loan was refinanced on December 3, 2014. -   34,000

Prudential Mortgage Capital Company, LLC fixed rate term loans:  the loans bear interest at the rate of 5.35% per annum as of June 30, 2015.  The loans are collateralized by real estate and mature in June 2033. 25,930 27,550

Prudential Mortgage Capital Company, LLC fixed rate term loan:  the loan bears interest at the rate of 3.85% per annum as of June 30, 2015.  The loan is collateralized by real estate and matures in September 2021. 5,445 -

Prudential Mortgage Capital Company, LLC fixed rate term loan:  the loan bears interest at the rate of 3.45% per annum as of June 30, 2015.  The loan is collateralized by real estate and matures in September 2039. 5,445 -

Note payable to a financing company secured by equipment and maturing in December 2016. 72 90

206,580 61,640
Less: current portion 4,511 3,196

Long-term debt $ 202,069 $ 58,444

(in thousands)
June 30, September 30,
2015 2014

Lines of Credit:
Metropolitan Life Insurance Company and New England Life Insurance Company revolving line of credit:  this $25 million line bears interest at a variable rate which was 1.78% per annum as of June 30, 2015.  The line is secured by real estate and matures in November 2019. $ -   $ -

Rabo Agrifinance, Inc. working capital line of credit:  this $70 million line bears interest at a variable rate which was 1.93% per annum as of June 30, 2015.  The line is secured by personal property and matures in November 2016.  Availability under the line was $52.5 million as of June 30, 2015. -   -

Prudential Mortgage Capital Company, LLC revolving line of credit:  this $6 million line bears interest at a variable rate which was 3.01%  per annum as of March 31, 2015 and 2.98% per annum as of June 30, 2014, respectively.   The line is secured by real estate and matures in June 2018.  Availability under the line was $2.6 million as of March 31, 2015 and $2.8 million as of June 30, 2014. 3,348 3,160

Lines of Credit $ 3,348 $ 3,160

~~Debt Maturities~~

~~Maturities of the Company’s outstanding debt as of June 30, 2015 were as follows:~~

(in thousands)

Due within one year $ 4,511
Due between one and two years 8,261
Due between two and three years 14,123
Due between three and four years 10,875
Due between four and five years 10,950
Due beyond five years 161,208

Total $ 209,928

Interest costs expensed and capitalized were as follows:

(in thousands) Three Months Ended June 30, Nine Months Ended June 30,
2015 2014 2015 2014

Interest expense $ 2,127 $ 657 $ 5,715 $ 1,322
Interest capitalized 71 40 283 118

Total $ 2,198 $ 697 $ 5,998 $ 1,440



(in thousands)	Three months ended December 31, 2015
	2015		2014
Interest expense	$	2,503	$	1,378
Interest capitalized	43		53
Total	$	2,546	$	1,431

Note 8.7. Earnings Per Common Share

Basic earnings per share for our common stock is calculated by dividing net income attributable to Alico, Inc. common stockholders by the weighted average number of shares of common stock ~~outstanding.~~outstanding for the period. Diluted earnings per common share is similarly calculated, except that the calculation includes the dilutive effect of the assumed issuance of common shares issuable under equity-based compensation plans in accordance with the treasury stock method, except where the inclusion of such common shares would have an anti-dilutive impact.

For the three ~~and nine~~ months ended ~~June 30,~~December 31, 2015 and 2014, basic and diluted earnings per common share were as ~~follows~~follows:



(in thousands except per share amounts)
	Three months ended December 31,
	2015			2014

Net (loss) income attributable to Alico, Inc. common stockholders	$	(3,011	)	$	5,206

Weighted average number of common shares outstanding - basic	8,303			7,367
Dilutive effect of equity awards	—			—
Weighted average number of common shares outstanding - diluted	8,303			7,367

Net (loss) income per common shares attributable to Alico, Inc. common stockholders:
Basic	$	(0.36	)	$	0.71
Diluted	$	(0.36	)	$	0.71

(~~in thousands, except per share amounts~~):

Three Months Ended June 30, Nine Months Ended June 30,
2015 2014 2015 2014

Net income attributable to Alico, Inc. common stockholders $ 7,767 $ 1,031 $ 18,292 $ 5,023

Weighted average number of common shares outstanding - basic 8,278 7,356 7,969 7,327
Dilutive effect of equity awards 6 - 2 24
Weighted average number of common shares outstanding - diluted 8,284 7,356 7,971 7,351

Net income per common shares attributable to Alico, Inc.
common stockholders:
Basic $ 0.94 $ 0.14 $ 2.30 $ 0.69
Diluted $ 0.94 $ 0.14 $ 2.29 $ 0.68

~~For the three and nine months ended June 30, 2015, there were no anti-dilutive equity awards that were excluded from the calculation~~

The computation of diluted earnings per ~~share.~~

common share for the three months ended December 31, 2015 excludes the impact of the equity awards because they are anti-dilutive. Such awards are comprised of 12,500 shares awarded to the Chief Executive Officer and Chief Financial Officer during the fiscal year ended September 30, 2015.

Note 9. 8. Segment Information

Segments

Operating segments are defined in ASC Topic 280, "Segment Reporting" as components of public entities that engage in business activities from which they may earn revenues and incur expenses for which separate financial information is available and which isare evaluated regularly by the Company’s ~~chief operating decision makers (“CODMs”)~~CODMs in deciding how to assess performance and allocate resources. ~~The~~For the fiscal year ended September 30, 2015, the Company’s CODMs ~~assess~~assessed performance and ~~allocate~~allocated resources based on five operating segments: Citrus Groves, Improved Farmland, Ranch and Conservation, Agricultural Supply Chain Management and Other Operations.

The former Citrus Groves and Agricultural Supply Chain Management segments have been combined in Orange Co. and, as a result of the disposition of our sugarcane land in fiscal year 2015, we are no longer involved in sugarcane and the Improved

Farmland segment is no longer material to our business and has been combined in Other Operations. Effective October 1, 2015, the Company’s CODMs will assess performance and allocate resources based on three operating segments: Orange Co., Conservation and Environmental Resources and Other Operations.

The Company manages its land based upon its primary usage and reviews its performance based upon ~~three~~two primary classifications ~~– Citrus Groves, Improved Farmland~~- Orange Co. and ~~Ranch~~Conservation and ~~Conservation.~~Environmental Resources. In addition, ~~it operates an Agricultural Supply Chain Management business that is not tied directly to its land holdings and~~ Other Operations ~~that~~ include ~~a citrus nursery and~~ leasing mines and oil extraction rights to third parties, as well as leasing improved farmland to third parties.

Total revenues represent sales to unaffiliated customers, as reported in the Condensed Combined Consolidated Statements of Operations and Comprehensive Income. Intersegment sales and transfers are accounted by the Company as if the sales or transfers were to third parties at current market prices. Goods and services produced by these segments are sold to wholesalers and processors in the United States who prepare the products for consumption. The Company evaluates the segments’ performance based on direct margins (gross profit) from operations before ~~corporate,~~ general and administrative expenses, interest expense, other income (expense) and income taxes, not including nonrecurring gains and losses. All intercompany transactions between the segments have been eliminated.

Information by business segment is as ~~follows~~~~(in thousands):~~

Three Months Ended June 30, Nine Months Ended June 30,
2015 2014 2015 2014
Operating revenues:
Citrus Groves $ 65,795 $ 27,167 $ 129,084 $ 55,390
Agricultural Supply Chain Management 2,105 4,083 6,584 12,324
Improved Farmland 418 2,159 2,492 19,441
Ranch and Conservation 296 408 1,441 1,849
Other Operations 195 58 508 502
Intersegment Revenues 5,058 4,173 10,444 9,299
Eliminations (5,058 ) (4,173 ) (10,444 ) (9,299 )

Total revenues $ 68,809 $ 33,875 $ 140,109 $ 89,506

Operating expenses:
Citrus Groves $ 45,551 $ 18,317 $ 96,027 $ 36,560
Agricultural Supply Chain Management 1,467 3,916 5,578 12,085
Improved Farmland 659 6,591 2,736 20,986
Ranch and Conservation 624 684 1,992 2,231
Other Operations 693 (226 ) 786 281

Total operating expenses $ 48,994 $ 29,282 $ 107,119 $ 72,143

Gross profit (loss):
Citrus Groves $ 20,244 $ 8,850 $ 33,057 $ 18,830
Agricultural Supply Chain Management 638 167 1,006 239
Improved Farmland (241 ) (4,432 ) (244 ) (1,545 )
Ranch and Conservation (328 ) (276 ) (551 ) (382 )
Other Operations (498 ) 284 (278 ) 221

Total gross profit (loss) $ 19,815 $ 4,593 $ 32,990 $ 17,363

Capital expenditures:
Citrus Groves $ 4,413 $ 2,354 $ 5,018 $ 6,380
Agricultural Supply Chain Management 17 -   346 71
Improved Farmland -   44 -   3,729
Ranch and Conservation 369 103 559 879
Other Operations 47 (172 ) 3,458 28
Other Capital Expenditures 214 168 293 168

Total capital expenditures $ 5,060 $ 2,497 $ 9,674 $ 11,255

Depreciation, depletion and amortization:
Citrus Groves $ 3,037 $ 1,132 $ 7,877 $ 2,196
Agricultural Supply Chain Management 109 41 254 123
Improved Farmland -   572 -   3,194
Ranch and Conservation 291 335 776 997
Other Operations 347 477 745 586
Other Depreciation, Depletion and Amortization 67 (252 ) 267 148

Total depreciation, depletion and amortization $ 3,851 $ 2,305 $ 9,919 $ 7,244

follows:

(in thousands)
June 30,
2015 September 30, 2014
Assets:
Citrus Groves $ 407,107 $ 121,399
Agricultural Supply Chain Management 2,717 2,498
Improved Farmland 1,556 57,726
Ranch and Conservation 14,480 13,920
Other Operations 33,836 26,356
Other Corporate Assets 10,526 35,679

Total assets $ 470,222 $ 257,578



(in thousands)	Three Months Ended December 31,
	2015			2014
Revenues:
Orange Co.	$	19,295		$	16,993
Conservation and Environmental Resources	1,007			836
Other Operations	302			1,241
Total revenues	20,604			19,070

Operating expenses:
Orange Co.	17,608			14,214
Conservation and Environmental Resources	1,560			745
Other Operations	70			839
Total operating expenses	19,238			15,798

Gross profit:
Orange Co.	1,687			2,779
Conservation and Environmental Resources	(553		)	91
Other Operations	232			402
Total gross profit	$	1,366		$	3,272

Depreciation, depletion and amortization:
Orange Co.	$	3,357		$	1,946
Conservation and Environmental Resources	232			243
Other Operations	106			128
Other Depreciation, Depletion and Amortization	313			667
Total depreciation, depletion and amortization	$	4,008		$	2,984



(in thousands)	December 31,		September 30,
	2015		2015
Assets:
Orange Co.	$	421,505	$	392,329
Conservation and Environmental Resources	13,776		13,779
Other Operations	21,189		31,468
Other Corporate Assets	12,512		22,512
Total Assets	$	468,982	$	460,088

Note ~~10. Stockholders’~~9. Stockholders' Equity

Effective January 27, 2015, the Company’s Board of Directors adopted the Stock Incentive Plan of 2015 (the “2015 Plan”) which provides for up to an additional 1,250,000 shares available for issuance to provide a long-term incentive plan for officers, employees, directors and/or consultants to directly link incentives to stockholder value. The 2015 Plan was approved by stockholders on February 25, 2015.

The adoption of the 2015 Plan superseded the 2013 Incentive Equity Plan (“2013 Plan”), which had been in place since April 2013. In the three months ended June 30, 2015, the Company awarded 12,500 restricted shares of the company’s common stock (“Restricted Stock”) to two senior executives, under the 2015 Plan. Total stock compensation expense for the restricted stock was approximately $17,000 for the three months ended June 30, 2015.

The Company ~~also~~ recognizes ~~stock~~stock-based compensation expense for (i) Board of Directors fees (paid in treasury stock) and (ii) the ~~Long Term~~Stock Incentive ~~Compensation~~ Plan of 2015 (via restricted stock). Stock-based compensation expense for the Board of Director fees and ~~Long Term Incentive Compensation Plan~~Named Executive Officers was ~~$176,200~~approximately $245,000 and ~~$585,000~~$254,000 for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2015 ~~respectively,~~ and ~~$204,000 and $909,000 for the three and nine months ended June 30,~~ 2014, respectively. Stock compensation expense is recognized in corporate, general and administrative expenses in the Condensed Combined Consolidated Statements of Operations and Comprehensive Income.

In ~~March~~fiscal year 2015, the Board of Directors authorized the repurchase of up to ~~20,000~~170,000 shares of the Company’s common stock beginning March 25, 2015 and continuing through ~~March 25,~~December 31, 2016. The stock repurchases were made through open market transactions at times and in such amounts as the Company’s broker determined subject to the provisions of SEC Rule 10b-18. ~~All repurchases were made by April 30, 2015.~~ The following table illustrates the Company’s treasury stock purchases and issuances for the ~~nine~~three months ended ~~June 30,~~December 31, 2015:

(in thousands, except share amounts) Shares Cost

Balance as of September 30, 2014 15,766 $ 650
Purchased 20,000 1,029
Issued to Directors and Named Executive Officers (12,916 ) (532 )

Balance as of June 30, 2015 22,850 $ 1,147



(in thousands, except share amounts)
	Shares		Cost

Balance as of September 30, 2015	90,565		$	3,962
Purchased	64,136		2,602
Issued to Directors	(15,703	)	(809		)

Balance as of December 31, 2015	138,998		$	5,755

Note ~~11.~~10. Commitments and Contingencies

Letters of Credit

The Company has outstanding standby letters of credit in the total amount of approximately $13,984,000 and $17,498,500 at December 31, 2015 and September 30, 2015, respectively, to secure its various contractual obligations.

Legal Proceedings

On March 11, 2015, a putative ~~shareholder~~stockholder class action lawsuit captioned Shiva Y. Stein v. Alico, Inc., et al., No. 15-CA-000645 (the “Stein lawsuit”), was filed in the Circuit Court of the Twentieth Judicial District in and for Lee County, Florida, against Alico, Inc. (“Alico”), its current and certain former directors, 734 Citrus Holdings, LLC d/b/a Silver Nip Citrus, ~~(“Silver Nip”),~~ 734 Investors, LLC (“734 Investors”), 734 Agriculture, LLC (“734 Agriculture”) and 734 Sub, LLC (“734 Sub”) in connection with the acquisition of Silver Nip by Alico (the “Acquisition”). The complaint alleges that Alico’s directors at the time of the Acquisition, 734 Investors and 734 Agriculture breached fiduciary duties to Alico stockholders in connection with the Acquisition and that Silver Nip and 734 Sub aided and abetted such breaches. The lawsuit seeks, among other things, monetary and equitable relief, costs, fees (including attorneys’ fees) and expenses.

On May 6, 2015, a putative stockholder class action and derivative lawsuit captioned Ruth S. Dimon Trust v. George R. Brokaw, et al., No. 15-CA-001162 (the “Dimon lawsuit”), was filed in the Circuit Court of the Twentieth Judicial District in and for Lee County, Florida, against Alico, its current directors, Silver Nip Citrus, 734 Investors and 734 Agriculture in connection with the Acquisition of Silver Nip Citrus by Alico. The complaint alleges claims for breach of fiduciary duty, gross mismanagement, waste of corporate assets and tortious interference with contract against Alico’s directors, unjust enrichment against three of the directors and aiding and abetting breach of fiduciary duty against Silver Nip Citrus, 734 investors and 734 Agriculture. The lawsuit seeks, among other things, rescission of the Acquisition, an injunction prohibiting certain payments to Silver Nip ~~shareholders,~~Citrus members, unspecified damages, disgorgement of profits, costs, fees (including attorneys’ fees) and expenses.

On July 17, 2015, the plaintiffs in the Stein and Dimon lawsuits filed a stipulation and proposed order consolidating their cases for all purposes under the caption, In re Alico, Inc. Shareholder Litigation, Master File No. 15-CA-000645 (the “Consolidated Action”) and seeking the appointment of a lead plaintiff and lead and liaison counsel. The court entered that proposed order on July 21, 2015.

On October 16, 2015, the lead plaintiff in the Consolidated Action reported to the court that the parties reached an agreement in principle to settle the Consolidated Action and other claims related to the Acquisition and that they are in the process of formally documenting their agreements. That process is ongoing and the settlement remains subject to final documentation and court approval following notice to the relevant Alico shareholders. Once the parties have completed the settlement documents, they

will contact the court to schedule a hearing at which they will request the court to preliminarily approve the settlement and to set a final settlement hearing date.

From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. There are no current legal proceedings to which we are a party to or of which any of our property is subject to that we believe will have a material adverse effect on our business financial ~~condition~~position or results of operations.

Note ~~12.~~11. Related Party Transactions

~~Change in Control Transaction~~

On November 19, 2013, 734 Agriculture, LLC (“734 Agriculture”) and its affiliates, including 734 Investors, LLC (“734 Investors”), completed the previously announced purchase from Alico Holding, LLC, a company wholly owned by Atlantic Blue Group, Inc. (“Atlanticblue”), of 3,725,457 shares of our common stock (the “Share Purchase”).

The common stock acquired by 734 Agriculture and its affiliates, including 734 Investors, represented approximately 51% of the Company’s outstanding voting securities. On November 15, 2013, 734 Investors amended and restated its LLC operating agreement to admit new members and to designate 734 Agriculture as the managing member, with authority to administer the affairs of 734 Investors, including the voting and disposition of shares of common stock, subject to certain restrictions set forth therein. As a result, upon the consummation of the Share Purchase, 734 Agriculture and its affiliates, including 734 Investors, acquired the voting power to control the election of the Company’s Directors and any other matter requiring the affirmative vote or consent of the Company’s shareholders. Messrs. Remy W. Trafelet and George R. Brokaw are the two controlling persons of 734 Agriculture.

~~Appointment of Mr. Wilson as the Company’s Chief Executive Officer~~

Upon the Closing of the Share Purchase, Mr. JD Alexander ceased to be the Company’s CEO pursuant to his previously disclosed resignation. On November 22, 2013, the Board appointed Mr. Wilson to serve as the CEO, effective immediately.

Silver Nip Citrus Merger Agreement

Effective February 28, 2015, the Company completed the merger (“Merger”) with 734 Citrus Holdings, LLC (“Silver Nip Citrus”) pursuant to an Agreement and Plan of Merger (the “Merger Agreement”) with 734 Sub, LLC, a wholly owned subsidiary of the Company (“Merger Sub”), Silver Nip Citrus and, solely with respect to certain sections thereof, the equity holders of Silver Nip Citrus. The ownership of Silver Nip Citrus was held by 734 Agriculture, 74.89%, Mr. Clay Wilson, Chief Executive Officer of the Company, 5% and an entity controlled by Mr. Clay Wilson owned, 20.11%.

734 Agriculture has control over both Silver Nip Citrus and the Company and therefore the Merger was treated as a common control acquisition.

At closing of the Merger, Merger Sub merged with and into Silver Nip Citrus, with Silver Nip Citrus and its affiliates surviving the Merger as wholly owned subsidiaries of the Company. Pursuant to the Merger Agreement, at closing, the Company issued 923,257 shares of the Company’s common stock, par value $1.00 per share, to the holders of membership interests in Silver Nip Citrus. Silver Nip Citrus’ outstanding net indebtedness at the closing of the Merger was approximately $40,278,000 and other liabilities totaled approximately $6,952,000. The Company acquired assets at with a book value of approximately $65,739,000 and total net assets of approximately $18,470,000. The shares issued were recorded at the carrying amount of the net assets transferred.

~~According to the terms~~ The closing price of the ~~Merger Agreement,~~Company's common stock on February 27, 2015 was $45.67.

Through December 2015, the former holders of ~~the~~ membership interests (the "Members") in Silver Nip Citrus ~~will receive~~earned an additional ~~Company~~148,705 shares of the Company’s common stock pursuant to the Merger Agreement. The additional purchase consideration was based on the value of the proceeds received to date by the Company from the sale of citrus fruit harvested on Silver Nip ~~Citrus’ real property during~~Citrus’s citrus groves following the conclusion of the 2014-2015 citrus harvest season. ~~Additional consideration due~~The Members will receive additional Company common shares based on ~~sales through May 31,~~any additional proceeds received by the Company subsequent to December 2015 is approximately 115,783 shares. The computation of additional consideration for the June 2015 harvest proceeds (the final proceeds of the harvest season) is pending receipt of final pricing information from processors, (see “Note 1”related to the ~~accompanying~~2014-2015 harvest season.

For the three months ended December 31, 2014, the Company incurred approximately $492,000 in professional and legal costs in connection with the Merger. These costs are included in corporate, general and administrative expenses in the Condensed Combined Consolidated ~~Financial Statements).~~

Statements of Operations and Comprehensive Income for the three months ended December 31, 2014.

JD Alexander

On November 6, 2013, JD Alexander tendered his resignation as Chief Executive Officer and as an employee of the Company, subject to and effective immediately after the Closing of the Share Purchase transaction on November 19, 2013. Mr. Alexander’s resignation ~~includes~~included a waiver of any rights to any payments under his Change-in-Control Agreement with the Company. On November 6, 2013, the Company and Mr. Alexander also entered into a Consulting and Non-Competition Agreement under which (i) Mr. Alexander will provide consulting services to the Company during the two-year period after the Closing, (ii) Mr. Alexander agreed to be bound by certain non-competition covenants relating to the Company’s citrus operations and non-solicitation and non-interference covenants for a period of two years after the Closing, and (iii) the Company ~~will pay~~paid Mr. Alexander for such services and covenants $2,000,000 in twenty-four monthly installments. ~~Mr. Alexander also agreed, in a separate side letter with~~The Company expensed approximately $167,000 and $250,000 under the ~~Company, not to sell or transfer~~Consulting and Non-Competition Agreement for the shares that were awarded pursuant to his Restricted Stock Award Agreement (other than to a family trust) for a period of two years after the Closing. Mr. Alexander also executed a general release in favor of the Company.

three months ended December 31, 2015 and 2014, respectively.

Ken Smith

On March 20, 2015, Ken Smith tendered his resignation as Chief Operating Officer and as an employee of the Company. Mr. Smith’s resignation ~~includes~~included a waiver of any rights to any payments under his Change-in-Control Agreement with the Company. On March 20, 2015, the Company and Mr. Smith also entered into a Consulting and Non-Competition Agreement under which (i) Mr. Smith will provide consulting services to the Company during the three-year period after the resignation date, (ii) Mr. Smith agreed to be bound by certain non-competition covenants relating to the Company’s citrus operations and non-solicitation and non-interference covenants for a period of two years after the resignation date, and (iii) the Company will pay Mr. Smith up to $1,225,000 for such services and covenants. The Company’s business operations previously managed by Mr. Smith ~~will~~are now be

managed by Clay Wilson, Chief Executive Officer of Alico. The Company ~~does not expect to appoint an interim or ongoing Chief Operating Officer~~

expensed approximately $50,000 under the Consulting and Non-Competition Agreement for the three months ended December 31, 2015.

W. Mark Humphrey

On June 1, 2015, W. Mark Humphrey tendered his resignation as Senior Vice President and Chief Financial Officer and as an employee of the Company. On June 1, 2015, the Company and Mr. Humphrey entered into a Separation and Consulting Agreement under which (i) Mr. Humphrey will provide consulting services to the Company for a one-year period after his resignation, and (ii) Mr. Humphrey will be entitled ~~subject to his execution, delivery, and non-revocation of a general release of claims in favor of the Company,~~ to the following benefits: (a) $100,000 in cash in a lump sum and (b) a consulting fee of $350,000 payable monthly during the period commencing on his resignation date and ending on the first anniversary of his resignation ~~date, subject to his continuing to provide services to~~date. The Company expensed approximately $88,000 under the ~~Company.~~Separation and Consulting Agreement for the three months ended December 31, 2015. On June 1, 2015, the Company appointed John E. Kiernan to serve as Senior Vice President and Chief Financial Officer.

Effective September 1, 2015, Mr. Humphrey was appointed to serve as Senior Vice President and Chief Accounting Officer and will continue to receive monthly payments under The Consulting Agreement through the first anniversary of his resignation date.

Shared Services Agreement

The Company has ~~approved, but not yet executed,~~ a shared services agreement with Trafelet Brokaw & Co., LLC (“TBCO”) whereby the Company will reimburse TBCO for use of office space and various administrative and support services. The annual cost of the office and services is approximately $400,000. The agreement will expire in June 2016.

The Company expensed approximately $98,560 under the Shared Services Agreement for the three months ended December 31, 2015.

Note 12. Accrued Liabilities

Accrued Liabilities consist of the following at December 31, 2015 and 2014:

~~ITEM 2.~~

~~ALICO, INC. AND SUBSIDIARIES~~

(in thousands) December 31, September 30,
2015 2015

Ad valorem taxes $ 163
$ 2,640
Accrued interest 1,247
1,155
Accrued employee wages and benefits 1,522
427
Inventory received but not invoiced 456
581
Accrued dividends 497
501
Current portion of deferred retirement obligations 342
342
Additional purchase price consideration 3,750
7,500
Other accrued liabilities 357
669
Total accrued liabilities $ 8,334
$ 13,815

17
~~MANAGEMENT’S DISCUSSION AND ANALYSIS~~

~~OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the accompanying Consolidated and Combined Financial Statements and related ~~notes~~Notes thereto. Additional context can also be found in our Annual Report on Form 10-K for the fiscal year ended September 30, ~~2014,~~2015, as filed with the Securities and Exchange Commission (“SEC”) on December ~~12, 2014.~~

10, 2015.

Cautionary Statement Regarding Forward-Looking Information

We provide forward-looking information in this Quarterly Report on Form 10-Q, particularly in this Management’s Discussion and Analysis and Results of Operations, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any statements in this Quarterly Report on Form 10-Q that are not historical facts are forward-looking statements. Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statements relating to our future activities or other future events or conditions. These statements are based on our current expectations, estimates and projections about our business based, in part, on assumptions made by our management. Factors which may cause future outcomes to differ materially from those foreseen in forward-looking statements include, but are not limited to: changes in laws, regulation and rules; weather conditions that affect production, transportation, storage, demand, import and export of fresh product and their by-products, increased pressure from disease, insects and other pests; disruption of water supplies or changes in water allocations; pricing and supply of raw materials and products; market responses to industry volume pressures; pricing and supply of energy; changes in interest rates; availability of financing for land development activities and other growth opportunities; ~~one time~~onetime events; acquisitions and divestitures including our ability to achieve the anticipated results of the Orange-Co acquisition and Silver Nip Citrus merger; seasonality; labor disruptions; inability to pay debt obligations; inability to engage in certain transactions due to restrictive covenants in debt instruments; government restrictions on land use; changes in agricultural land values; changes in dividends; and market and pricing risks due to concentrated ownership of stock. These assumptions are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including those ~~risks factors~~Risks Factors described in our Annual Report on Form 10-K for the year ended September 30, ~~2014~~2015 and our Quarterly Reports on Form 10-Q.

Business Overview

Business Description

We ~~manage~~generate operating revenues primarily from the sale of our ~~land based upon its primary usage~~citrus products and ~~review its performance based upon three primary classifications – Citrus Groves, Improved Farmland, and Ranch and Conservation. In addition,~~cattle ranching operations. Effective October 1, 2015, we operate an Agricultural Supply Chain Management business that is not tied directly to our land holdings and Other Operations that include leases for mining and oil extraction rights to third parties. We present our financial results and the related discussions based upon these fiveas three business segments ~~(Citrus~~and substantially all of our operating revenues are generated in the United States. During the three months ended December 31, 2015, we generated operating revenues of $20,604,000, loss from operations of $2,559,000, net loss of $3,011,000 and cash used in operations of $14,781,000.

Business Segments

Operating segments are defined in Financial Accounting Standards Board ("FASB") - Accounting Standards Codification ("ASC") ASC Topic 280, "Segment Reporting" as components of public entities that engage in business activities from which they may earn revenues and incur expenses for which separate financial information is available and which is evaluated regularly by the Company’s chief operating decision makers (“CODMs”) in deciding how to assess performance and allocate resources. For the fiscal year ended September 30, 2015, the Company’s CODMs assessed performance and allocated resources based on five operating segments: Citrus Groves, Improved Farmland, Ranch and Conservation, Agricultural Supply Chain Management and Other ~~Operations).~~

~~In connection with~~Operations.

Effective October 1, 2015, which is the first day of our ~~pursuit~~fiscal year 2016, we operate three business segments related to our various land holdings, as follows:

Orange Co. includes activities related to planting, owning, cultivating and/or managing citrus groves in order to produce fruit for sale to fresh and processed citrus markets, including activities related to the purchase and resale of ~~growth opportunities consistent with our mission, we intend~~fruit, as well as, to ~~regularly evaluate potential acquisitions~~value-added services which include contracting for the harvesting, marketing and ~~divestitures~~hauling of citrus.

Conservation and Environmental Resources includes activities related to cattle grazing, sod, native plant and animal sales, leasing, management and/or conservation of unimproved native pasture land.

Other Operations consists of activities related to rock mining royalties, oil exploration and other insignificant lines of business, ~~opportunities, some~~and also includes activities related to owning and/or leasing improved farmland. Improved farmland is acreage that has been converted, or is permitted to be converted, from native pasture and which may have various improvements including irrigation, drainage and roads.

The former Citrus Groves and Agricultural Supply Chain Management segments have been combined in Orange Co. and, as a result of ~~which~~the disposition of our sugarcane land in fiscal year 2015, we are no longer involved in sugarcane and the Improved Farmland segment is no longer material in nature. If appropriate opportunities present themselves, we may engage in selected acquisitions, divestitures and other business growth initiatives or undertakings. To the extent we engage in such opportunities it could, among other things, change our revenue mix, require us to ~~obtain additional debt or equity financing and have a material impact on~~ our business and has been combined in Other Operations.

Change in Fiscal Year of Subsidiary

As Alico, Inc. ("Company") and Silver Nip Citrus were under common control at the time of the Merger, we are required under accounting principles generally accepted in the United States of America ("U.S. GAAP") to account for this common control acquisition in a manner similar to the pooling of interest method of accounting. Under this method of accounting, our Condensed Combined Consolidated Balance Sheets as of December 31, 2015 and September 30, 2015 reflect Silver Nip Citrus’ historical carryover basis in the assets and liabilities instead of reflecting the fair market value of the assets and liabilities. We have also retrospectively recast our financial statements to combine the operating results of the Company and Silver Nip Citrus from the date common control began, November 19, 2013.

Silver Nip Citrus’ fiscal year end was June 30, and their financial condition and results of operations as of and ~~cash flows.~~

~~Business Segments~~

~~We own approximately 121,000 acres~~for the fiscal years ended June 30, 2015 and 2014 were included in the financial condition and results of ~~land in twelve Florida counties (Alachua, Charlotte, Collier, DeSoto, Glades, Hardee, Hendry, Highlands, Lee, Martin Osceola~~operations of the Company as of and ~~Polk),~~for the fiscal years ended September 30, 2015 and ~~approximately 90,000 acres of mineral rights, and operate five business segments.~~

~~Citrus Groves include activities related to planting, owning, cultivating and/or managing citrus groves in order to produce fruit~~2014, respectively. Effective October 1, 2015, the fiscal year end for ~~sale to fresh and processed citrus markets.~~

Agricultural Supply Chain Management and Support includes activities related to the purchase and resale of fruit, as well as, to value-added services which include contracting for the harvesting, marketing and hauling of citrus.

Improved Farmland includes activities related to owning and/or leasing improved farmland. Improved Farmland is acreage that has been converted, or is permitted to be converted, from native pasture and which may have various improvements including irrigation, drainage and roads.

~~Ranch and Conservation includes activities related to cattle grazing, sod, native plant and animal sales, leasing, management and/or conservation of unimproved native pasture land.~~

~~Other Operations include activities related to a citrus nursery, rock mining royalties, oil exploration and other insignificant lines of business.~~

~~Recent Events~~

Silver Nip ~~Merger Agreement~~

Citrus was changed to September 30 to reflect that of the Company. Accordingly, the Company’s financial condition as of December 31, 2015 and September 30, 2015 now includes the financial condition of Silver Nip Citrus as of December 31, 2015 and September 30, 2015, and the Company’s results of operations for the three months ended December 31, 2015 and 2014 now includes the Silver Nip Citrus’ results of operations for the three months ended December 31, 2015 and 2014. The impact of this change was not material to the Condensed Combined Consolidated Financial Statements with an approximate $480,000 decrease in total assets and an approximate net loss of $594,000 for the transition period related to this change included in Stockholders' Equity at September 30, 2015.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed combined consolidated financial statements which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. We base these estimates on historical experience, available current market information and on various other assumptions that management believes are reasonable under the circumstances. Additionally we evaluate the results of these estimates on an on-going basis. Management’s estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

There have been no significant changes during this reporting period to the policies and disclosures set forth in Part II, Item 7 in our Annual Report on Form 10-K for the fiscal year ended September 30, 2015.

See Note 1, "Basis of Presentation - Summary of Significant Accounting Policies," to the condensed combined consolidated financial statements in Item 1 of Part I of this 10-Q, for a detailed description of recent pronouncements.

Recent Developments

Common Control Acquisition between the Company and 734 Citrus Holdings, LLC

Effective February 28, 2015, the Company completed the merger ~~(“Merger”~~(the “Merger”) with 734 Citrus Holdings, LLC (“Silver Nip Citrus”) pursuant to an Agreement and Plan of Merger (the “Merger Agreement”) with 734 Sub, LLC, a wholly owned subsidiary of the Company (“Merger Sub”), Silver Nip Citrus and, solely with respect to certain sections thereof, the equity holders of Silver Nip Citrus. The ownership of Silver Nip Citrus was held by 734 Agriculture, 74.89%, Mr. Clay Wilson, Chief Executive Officer of the Company, 5% and an entity controlled by Mr. Clay Wilson owned, 20.11%.

On November 19, 2013, 734 Agriculture and its affiliates, including 734 Investors, acquired approximately 51% of the Company’s common stock. 734 Agriculture is the sole managing member of 734 Investors. By virtue of their ownership percentage, 734 Agriculture is able to elect all of the Directors and, consequently, control ~~Alico.~~

the Company.

734 Agriculture has control over both Silver Nip Citrus and the Company and therefore the Merger was treated as a common control acquisition.

At closing of the Merger, Merger Sub merged with and into Silver Nip Citrus, with Silver Nip Citrus and its affiliates surviving the Merger as ~~wholly owned~~wholly-owned subsidiaries of the Company. Pursuant to the Merger Agreement, at closing, the Company issued 923,257 shares of the Company’s common stock, par value $1.00 per share, to the holders of membership interests in Silver Nip Citrus. Silver Nip Citrus’ outstanding net indebtedness at the closing of the Merger was approximately $40,278,000 and other liabilities totaled $6,952,000. The Company acquired assets with a book value of approximately $65,739,000 and total net assets of $18,470,000. The common shares issued were recorded at the carrying amount of the net assets transferred. ~~The~~

Through December 2015, the former holders of membership interests (the "Members") in Silver Nip Citrus ~~will also receive~~earned an additional ~~Company~~148,705 shares of the Company’s common stock pursuant to the Merger Agreement. The additional purchase consideration was based on the value of the proceeds received to date by the Company from the sale of citrus fruit harvested on Silver Nip ~~Citrus’ real property~~Citrus’s citrus groves following the conclusion of the 2014-2015 citrus harvest season.

The Members will receive additional Company common shares based on any additional proceeds received by the Company subsequent to December 2015 related to the 2014-2015 harvest season.

Water Storage Contract Approval

In December 2012, the South Florida Water Management District (“SFWMD” or "District") issued a solicitation request for projects to be considered for the Northern Everglades Payment for Environmental Services Program. In March 2013, the Company submitted its response proposing a dispersed water management project on a portion of its ranch land.

On December 11, 2014, the SFWMD approved a contract with the Company. The contract term is eleven years and allows up to one year for implementation (design, permitting, construction and construction completion certification) and ten years of operation whereby the Company will provide water retention services. Payment for these services includes an amount not to exceed $4,000,000 of reimbursement for implementation. In addition, it provides for an annual fixed payment of $12,000,000 for operations and maintenance costs as long as the project is in compliance with the contract and subject to annual SFWMD Governing Board ~~(“Board”~~(the “Board”) approval of funding. The contract specifies that the Board has to approve the payments annually and there can be no assurance that it will approve the annual fixed payments.

During the 2015 legislative session, the Governor of Florida vetoed the legislatively approved budget for dispersed water management projects. Although SFWMD did not receive the state funds for the project payments for the next fiscal year (October 2015 through September 2016), itSFWMD has amended the Contract with the Company to extend the duration for funding beyond the 2016 legislative session. This provided the District with options ~~available~~ to continue with the project.

As discussed above, the Dispersed Water Management Program Northern Everglades Payment for Environmental Services Contract between the Company and SFWMD provides that funding of the contract is subject to the ~~District~~SFWMD receiving funds for the project from the Florida Legislature and the ~~District~~SFWMD Governing Board budget appropriation.

The ~~District~~SFWMD budget process allows for amending the budget at any Governing Board meeting, which could allow for some funding ~~later~~ in ~~the~~ fiscal ~~year.~~year 2016. However, if no funds are provided in 2016 and accommodation is not reached to delay work on the project until funds are available, the District would be within its rights under the contract to terminate.

~~Orange-Co Acquisition~~

Prior year amounts have been reclassified in the ~~state of Florida. Total assets acquired were approximately $277,792,000, net of $2,060,000 in cash acquired and $4,838,000 in fair value attributable~~accompanying Financial Statements for consistent presentation to ~~noncontrolling interest, including: (1) $147,500,000 in initial cash consideration funded from~~ the ~~proceeds of the sugarcane disposition and new term debt; (2) up to $7,500,000 in additional cash consideration to be released from escrow in equal parts, subject to certain limitations,~~current period business segments. These reclassifications had no impact on ~~December 1, 2015 and June 1, 2016; (3) the refinancing of Orange-Co’s outstanding debt including approximately $92,290,000 in term debt and a~~ working capital, ~~facility~~net income, or equity of ~~approximately $27,857,000;~~cash flows as previously reported.

Condensed Combined Consolidated Results of Operations

The following discussion provides an analysis of our results of operations and (4) the assumption of certain other liabilities totaling $4,705,000. On December 1, 2014, Alico deposited an irrevocable standby letter of credit issued by Rabo Agrifinance, Inc. (“Rabo”) in the aggregate amount of $7,500,000 into an escrow account to fund the additional cash consideration.

~~Sugarcane Land Disposition~~

On November 21, 2014, the Company completed the sale of approximately 36,000 acres of land used for sugarcane production and land leasing in Hendry County, Florida to Global Ag Properties, LLC (“Global Ag Properties”) for $97,913,921 in cash. We had previously leased approximately 30,600 of these acres to United States Sugar Corporation (the “USSC Lease”). The USSC Lease was assigned to Global Ag Propertiesshould be read in conjunction with the ~~land sale.~~

Net proceeds from the sugarcane land sale of $97,126,000 were deposited with a Qualified Intermediary in anticipation of the Orange-Co asset acquisition in a tax deferred like-kind exchange pursuant to Internal Revenue Code Section §1031 (see “Note 4” to the accompanying ~~Condensed Combined Consolidated Financial Statements).~~

The sales price is subject to post-closing adjustments over a ten (10)-year period. The Company realized a gain of $42,753,000 on the sale. Initially, $29,140,000 of the gain was deferred due to the Company’s continuing involvement in the property pursuant to a post-closing agreement and the potential price adjustments. The deferral represents the Company’s estimate of the maximum exposure to loss as a result of the continuing involvement. A net gain of $13,613,000 was recognized in the Condensed Combined Consolidated Statements of Operations ~~and Comprehensive Income for the nine months ended June 30, 2015.~~

On May 1, 2015, the Company made a payment of $1,347,000 to Global Ag Properties pursuant to the sales contract. The USSC Lease is tied to the market price of sugar, and this payment is required annually, in advance, to supplement the rent paid by USSC in the event that the sugar prices are below certain thresholds. This advance payment is included in other current assets at June 30, 2015.

~~As a result of the disposition of our sugarcane land, we are no longer involved in sugarcane, and, as of November 21, 2014, the Improved Farmland segment was no longer material to our business.~~

Our sugarcane land was classified as assets held for sale as of September 30, 2014. The sugarcane operation has not been classified as a discontinued operation due to the Company’s continuing involvement pursuant to the post-closing agreement described above.

~~Results of Operations~~

~~The following table sets forth a comparison of results of operations~~ for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2015 and 2014:

(in thousands) Three Months Ended Nine Months Ended
June 30, Change June 30, Change
2015 2014 $ % 2015 2014 $ %

Operating revenues:
Citrus Groves $ 65,795 $ 27,167 $ 38,628 142.2 % $ 129,084 $ 55,390 $ 73,694 133.0 %
Agricultural Supply Chain Management 2,105 4,083 (1,978 ) (48.4 )% 6,584 12,324 (5,740 ) (46.6 )%
Improved Farmland 418 2,160 (1,742 ) (80.6 )% 2,492 19,441 (16,949 ) (87.2 )%
Ranch and Conservation 296 408 (112 ) (27.5 )% 1,441 1,849 (408 ) (22.1 )%
Other Operations 195 57 138 242.1 % 508 502 6 1.2 %
Total operating revenues 68,809 33,875 34,934 103.1 % 140,109 89,506 50,603 56.5 %

Gross Profit:
Citrus Groves 20,244 8,850 11,394 128.7 % 33,057 18,830 14,227 75.6 %
Agricultural Supply Chain Management 638 167 471 282.0 % 1,006 239 767 320.9 %
Improved Farmland (241 ) (4,432 ) 4,191 (94.6 )% (244 ) (1,545 ) 1,301 (84.2 )%
Ranch and Conservation (328 ) (276 ) (52 ) 18.8 % (551 ) (382 ) (169 ) 44.2 %
Other Operations (498 ) 284 (782 ) (275.4 )% (278 ) 221 (499 ) (225.8 )%
Total gross profit 19,815 4,593 15,222 331.4 % 32,990 17,363 15,627 90.0 %
Corporate, general and
administrative expenses 3,638 2,339 1,299 55.5 % 12,932 7,961 4,971 62.4 %

Income from operations 16,177 2,254 13,923 617.7 % 20,058 9,402 10,656 113.3 %
Other income (expense), net (2,183 ) (432 ) (1,751 ) 405.3 % 9,174 (1,143 ) 10,317 (902.6 )%

Income before income taxes 13,994 1,822 12,172 668.1 % 29,232 8,259 20,973 253.9 %
Income taxes 6,227 791 5,436 687.2 % 10,940 3,236 7,704 238.1 %

Net income $ 7,767 $ 1,031 $ 6,736 653.3 % $ 18,292 $ 5,023 $ 13,269 264.2 %



(in thousands)	Three Months Ended
	December 31,						Change
	2015			2014			$			%
Operating revenues:
Orange Co.	$	19,295		$	16,993		$	2,302		13.5	%
Conservation and Environmental Resources	1,007			836			171			20.5	%
Other Operations	302			1,241			(939		)	(75.7	)%
Total operating revenues	20,604			19,070			1,534			8.0	%

Gross profit:
Orange Co.	1,687			2,779			(1,092		)	(39.3	)%
Conservation and Environmental Resources	(553		)	91			(644		)	NM
Other Operations	232			402			(170		)	(42.3	)%
Total gross profit	1,366			3,272			(1,906		)	(58.3	)%

General and administrative expenses	3,925			5,484			(1,559		)	(28.4	)%
Loss from operations	(2,559		)	(2,212		)	(347		)	15.7	%
Total other (expense) income, net	(2,535		)	11,181			(13,716		)	(122.7	)%
(Loss) income before income taxes	(5,094		)	8,969			(14,063		)	(156.8	)%
(Benefit) provision for income taxes	(2,075		)	3,763			(5,838		)	(155.1	)%
Net (loss) income	(3,019		)	5,206			(8,225		)	(158.0	)%
Net loss attributable to noncontrolling interests	8			—			8			NM
Net (loss) income attributable to Alico, Inc. common stockholders	$	(3,011	)	$	5,206		$	(8,217	)	(157.8	)%

NM - Not meaningful

The following discussion provides an analysis of our ~~segment results of operations follows.~~

business segments:

Orange Co.

~~Citrus Groves~~

The table below presents key operating measures for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2015 and 2014:

(in thousands, except per box and per pound solids data)

Three Months Ended Nine Months Ended
June 30, Change June 30, Change
2015 2014 $ % 2015 2014 $ %

Operating Revenues:
Early and Mid Season $ 3,999 $ 2,907 $ 1,092 37.6 % $ 51,926 $ 25,273 $ 26,653 105.5 %
Valencias 54,693 23,692 31,001 130.9 % 66,730 27,130 39,600 146.0 %
Fresh Fruit 3,400 485 2,915 601.0 % 5,941 2,344 3,597 153.5 %
Other 3,703 83 3,620 NM 4,487 643 3,844 597.8 %
Total $ 65,795 $ 27,167 $ 38,628 142.2 % $ 129,084 $ 55,390 $ 73,694 133.0 %

Boxes Harvested:
Early and Mid Season 191 175 16 9.1 % 4,442 2,002 2,440 121.9 %
Valencias 4,056 1,485 2,571 173.1 % 4,944 1,730 3,214 185.8 %
Total Processed 4,247 1,660 2,587 155.8 % 9,386 3,732 5,654 151.5 %

Fresh Fruit 280 53 227 428.3 % 459 213 246 115.5 %
Total 4,527 1,713 2,814 164.3 % 9,845 3,945 5,900 149.6 %

Pound Solids Produced:
Early and Mid Season 1,198 1,066 132 12.4 % 26,139 12,321 13,818 112.1 %
Valencias 26,418 10,008 16,410 164.0 % 32,112 11,536 20,576 178.4 %
Total 27,616 11,074 16,542 149.4 % 58,251 23,857 34,394 144.2 %

Pound Solids per Box:
Early and Mid Season 6.27 6.09 0.18 3.0 % 5.88 6.15 (0.27 ) (4.4 )%
Valencias 6.51 6.74 (0.23 ) (3.4 )% 6.50 6.67 (0.17 ) (2.5 )%

Price per Pound Solids:
Early and Mid Season $ 3.34 $ 2.73 $ 0.61 22.3 % $ 1.99 $ 2.05 $ (0.06 ) (2.9 )%
Valencias $ 2.07 $ 2.37 $ (0.30 ) (12.7 )% $ 2.08 $ 2.35 $ (0.27 ) (11.5 )%

Price per Box:
Fresh Fruit $ 12.14 $ 9.15 $ 2.99 32.7 % $ 12.94 $ 11.00 $ 1.94 17.6 %

Operating Expenses:
Cost of Sales $ 33,762 $ 13,169 $ 20,593 156.4 % $ 70,572 $ 25,770 $ 44,802 173.9 %
Harvesting and Hauling 9,424 4,794 4,630 96.6 % 21,491 10,790 10,701 99.2 %
Other 2,365 354 2,011 568.1 % 3,964 - 3,964 NM
Total $ 45,551 $ 18,317 $ 27,234 148.7 % $ 96,027 $ 36,560 $ 59,467 162.7 %

~~NM - Not Meaningful~~



(in thousands, except per box and per pound solids data)

	Three Months Ended
	December 31,				Change
	2015		2014		$			%
Operating Revenues:
Early and Mid-Season	$	13,930	$	14,377	$	(447	)	(3.1	)%
Fresh Fruit	2,460		1,283		1,177			91.7	%
Purchase and Resale of Fruit	1,327		920		407			44.2	%
Other	1,578		413		1,165			282.1	%
Total	$	19,295	$	16,993	$	2,302		13.5	%
Boxes Harvested:
Early and Mid-Season	1,311		1,363		(52		)	(3.8	)%
Total Processed	1,311		1,363		(52		)	(3.8	)%
Fresh Fruit	196		86		110			127.9	%
Total	1,507		1,449		58			4.0	%
Pound Solids Produced:
Early and Mid-Season	6,931		7,500		(569		)	(7.6	)%
Total	6,931		7,500		(569		)	(7.6	)%
Pound Solids per Box:
Early and Mid-Season	5.29		5.50		(0.21		)	(3.8	)%
Price per Pound Solids:
Early and Mid-Season	$	2.01	$	1.92	$	0.09		4.7	%
Price per Box:
Fresh Fruit	$	12.55	$	14.88	$	(2.33	)	(15.7	)%
Operating Expenses:
Cost of Sales	$	10,907	$	9,008	$	1,899		21.1	%
Harvesting and Hauling	3,755		3,742		13			0.3	%
Purchase and Resale of Fruit	1,257		907		350			38.6	%
Other	1,689		557		1,132			203.2	%
Total	$	17,608	$	14,214	$	3,394		23.9	%

We sell our Early and Mid-Season and Valencia oranges to processors that convert the majority of the citrus crop into orange juice. They generally buy their citrus on a pound solids basis, which is the measure of the soluble solids (sugars and acids) contained in one box of fruit. Fresh Fruit is generally sold to packing houses that purchase their citrus on a per box basis. Purchase and resale of fruit relates to the buying of fruit from third parties and generally reselling this fruit to processors. These revenues and costs vary based on the number of boxes bought and sold. Other revenues consist of third party grove caretaking and the contracting for harvesting and hauling of citrus.

Our operating expenses consist primarily of cost of sales and harvesting and ~~hauling.~~hauling costs. Cost of sales represents the cost of maintaining our citrus groves for the preceding calendar year and does not vary in relation to production. Harvesting and hauling ~~represents~~costs represent the ~~cost~~costs of bringing citrus product to processors and varies based upon the number of boxes produced.

Other expenses include the period costs of third-party grove caretaking and the contracting for harvesting and hauling activities.

The increase in citrus grove revenues ~~and gross profit~~ for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2015, as compared to the three ~~and nine~~ months ended ~~June 30,~~December 31, 2014, was primarily due to the ~~acquisition~~harvesting of ~~Orange-Co~~an additional 110,000 boxes of fresh fruit and an increase of 66,000 boxes in ~~December 2014. Orange-Co related revenues~~the resale of third party fruit. Additionally, the early and gross profit were approximately $34,608,000 and $10,274,000 for the three months ended June 30, 2015, respectively, and $72,233,000 and $18,060,000 for the nine months ended June 30, 2015, respectively. For the three and nine months ended June 30, 2015, Orange-Co revenues represented 53% and 56% of total citrus grove revenues.

~~Orange-Co related~~mid-season revenue decreased $447,000 due to fewer boxes harvested and fewer pound solids ~~produced totaled approximately 2,225,000~~per box, offset by a $0.09 price per pound solid increase. The increase in other revenues relates to increased contract harvest and ~~14,683,000~~haul for the three months ended June 30, 2015, respectively and approximately 5,307,000 and 33,323,000 for the nine months ended June 30, 2015, respectively. We included the financial results of Orange-Co in the accompanying Condensed Combined Consolidated Financial Statements from the date of acquisition.

a third party.

The USDA, in its ~~July 10, 2015~~January 12, 2016 Citrus Crop Forecast for the 2015/2016 harvest season, indicated that the ~~2014/2015~~ Florida orange crop ~~declined by 8,000,000~~will decrease from 96,800,000 boxes ~~or approximately 7.6% compared to~~for the ~~prior year. As indicated below, our~~ 2014/2015 crop ~~significantly outpaced the statewide performance on a~~year to 69,000,000 boxes ~~harvested basis with an increase of approximately 5% over the prior year.~~

~~Pro-Forma Results for Citrus Groves~~

~~The unaudited pro forma financial information below~~ for the ~~nine months ended June 30,~~2015/2016 crop year, a decrease of 28.7%. We have revised our 2016 production estimate and now expect our 2016 crop to be approximately 85% of our 2015 ~~and 2014 gives effect~~production. These declines are believed to the acquisition of Orange-Co as if the acquisition had occurred on October 1, 2014 and includes production from Silver Nip Citrus through June 30, 2015. The pro forma financial information is not necessarily indicative of the results of operations if the acquisitions had been effective as of this date.

~~(in thousands, except for pound solids per box)~~

Nine Months Ended June 30,
Citrus Boxes Harvested 2015 2014 Change % Change
Early & Mid-Season 4,442 4,631 (189 ) (4.1 )%
Valencias 5,569 5,031 538 10,7 %
Fresh Fruit 460 308 152 49.4 %
10,471 9,970 501 5.0 %

Pound Solids Produced
Early & Mid-Season 26,139 28,508 (2,369 ) (8.3 )%
Valencias 36,044 33,754 2,290 6.8 %
62,183 62,262 (79 ) (0.1 )%

Pound Solids Per Box
Early & Mid-Season 5.88 6.16 (0.28 ) (4.5 )%
Valencias 6.47 6.71 (0.24 ) (3.6 )%
Combined 6.21 6.44 (0.23 ) (3.6 )%

~~Citrus box and pound solids production fluctuates each~~be mainly driven by growing season ~~and these~~ fluctuations in production which may behave been attributable to various factors, including changes in weather impacting bloom, horticultural practices and the effects of diseases and pests, including Citrus Greening.

The industry and the Company are both experiencing premature fruit drop and smaller sized fruit. We continue to expect and have seen in our first quarter results that the forecasted 28.7% decrease in the size of the statewide crop will cause the price per pound solids for fiscal year 2016 to be above the price for fiscal year 2015.

~~Agricultural Supply Chain Management~~

The increase in cost of sales for the three ended December 31, 2015 relates to an increased cost per box sold of approximately 16%. While we expect our growing costs for fiscal year 2016 to remain in-line with fiscal year 2015, we are anticipating harvesting fewer boxes as discussed above and therefore the cost per box increase. Per box harvest and hauling costs for the three months ended December 31, 2015 were in-line with the three months ended December 31, 2014. The increase in other expenses relates to increased contract harvest and haul for a third party.

Conservation and Environmental Resources

The table below presents key operating measures for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2015 and 2014:

(in thousands, except per box and per pound solids data)

Three Months Ended Nine Months Ended
June 30, Change June 30, Change
2015 2014 $ % 2015 2014 $ %

Purchase and Resale of Fruit:
Revenues $ 1,524 $ 3,398 $ (1,874 ) (55.2 )% $ 5,168 $ 10,095 $ (4,927 ) (48.8 )%
Boxes Sold 112 235 (123 ) (52.3 )% 442 836 (394 ) (47.1 )%
Pound Solids Sold 742 1,571 (829 ) (52.8 )% 2,663 5,195 (2,532 ) (48.7 )%
Pound Solids per Box 6.63 6.69 (0.06 ) (0.9 )% 6.02 6.21 (0.19 ) (3.1 )%
Price per Pound Solids $ 2.05 $ 2.16 $ (0.11 ) (5.1 )% $ 1.94 $ 1.94 $ - -

Value Added Services:
Revenue $ 581 $ 670 $ (89 ) (13.3 )% $ 1,238 $ 1,891 $ (653 ) (34.5 )%
Value Added Boxes 209 71 138 194.4 % 537 652 (115 ) (17.6 )%

Other Revenue $ - $ 15 (15 ) (100.0 )% $ 178 $ 338 (160 ) (47.3 )%



(in thousands, except per pound data)
	Three Months Ended
	December 31,				Change
	2015		2014		$			%
Revenue From:
Sale of Calves	$	782	$	83	$	699		NM
Sale of Culls	—		490		(490		)	(100.0	)%
Land Leasing	221		224		(3		)	(1.3	)%
Other	4		39		(35		)	(89.7	)%
Total	$	1,007	$	836	$	171		20.5	%
Pounds Sold:
Calves	483		38		445			NM
Culls	—		370		(370		)	(100.0	)%
Price Per Pound:
Calves	$	1.62	$	2.18	$	(0.56	)	(25.7	)%
Culls	$	—	$	1.33	$	(1.33	)	(100.0	)%
Operating Expenses:
Cost of Calves Sold	$	602	$	3	$	599		NM
Cost of Culls Sold	—		199		(199		)	(100.0	)%
Land Leasing Expenses	44		56		(12		)	(21.4	)%
Water Conservation	914		487		427			87.7	%
Total	$	1,560	$	745	$	815		109.4	%

NM - Not Meaningful

Ranch

The ~~overall decline~~increase in revenues from the sale of calves for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2015 as compared to the three ~~and nine~~ months ended ~~June 30,~~December 31, 2014 is due to the increase in ~~Purchase and Resale of Fruit revenue, boxes~~pounds sold, ~~and pound solids sold, as well as the declines in Value Added Services revenues and other revenues, are all being driven~~partially offset by a ~~management decision to reduce the number of external boxes handled by Alico Fruit Company to focus on our internal operations. This decision was made~~decrease in price per pound. The increase in pounds sold in the ~~second~~current quarter was due to timing of ~~fiscal year 2014.~~

~~The decline~~calf sales as we held an additional 1,000 calves in ~~Alico Fruit Company gross profit relates primarily to the changes in revenue outlined above.~~

~~Improved Farmland~~

~~The table below presents key operating measures for the three and nine months ended June~~inventory at September 30, 2015, ~~and 2014:~~

(in thousands)

Three Months Ended Nine Months Ended
June 30, Change June 30, Change
2015 2014 $ % 2015 2014 $ %

Operating Revenues:
Sale of Sugarcane $ -   $ 1,410 $ (1,410 ) (100.0 )% $ -   $ 17,428 $ (17,428 ) (100.0 )%
Molasses Bonus -   56 (56 ) (100.0 )% -   817 (817 ) (100.0 )%
Land Leasing 418 693 (275 ) (39.7 )% 2,492 1,196 1,296 108.4 %
Total $ 418 $ 2,159 $ (1,741 ) (80.6 )% $ 2,492 $ 19,441 $ (16,949 ) (87.2 )%

Operating Expenses:
Cost of Sales $ -   $ 2,973 $ (2,973 ) (100.0 )% $ -   $ 13,881 $ (13,881 ) (100.0 )%
Harvesting and Hauling -   428 (428 ) (100.0 )% -   3,759 (3,759 ) (100.0 )%
Land Leasing Expenses 60 3,190 (3,130 ) (98.1 )% 577 3,346 (2,769 ) (82.8 )%
Guaranteed Payment 599 -   599 NM 2,159 -   2,159 NM
Total $ 659 $ 6,591 $ (5,932 ) (90.0 )% $ 2,736 $ 20,986 $ (18,250 ) (87.0 )%

NM - Not Meaningful

On May 19, 2014, the Company entered into a triple net agricultural lease with its sole sugarcane customer, United States Sugar Corporation (“USSC”), of approximately 30,600 gross acres of land in Hendry County, Florida used for sugarcane farming which ~~includes 19,181 acres planted or plantable to sugar. As a result of the lease, the Company is no longer directly engaged in sugarcane farming.~~

On August 8, 2014, we entered into a Purchase and Sale Agreement, (the “Purchase Agreement”) with Terra Land Company (“Terra”) to sell approximately 30,959 gross acres of land located in Hendry County, Florida used for sugarcane production for a base purchase price of $91,436,000. The base purchase price was subject to a valuation adjustment in the event that either the net farmable acres or net support acres of the land were more or less than the amounts in the Purchase Agreement by one percent (1%) or greater.

On November 21, 2014, via various amendments to the Purchase Agreement, we completed the sale to Global Ag Properties of approximately 36,000 gross acres of land located in Henry County, Florida used for sugarcane production for a purchase price of approximately $97,900,000 pursuant to the Purchase and Sale Agreement dated August 8, 2014. Global Ag Properties is a wholly-owned subsidiary of Terra. We have also assigned our interest in the USSC Lease to Global Ag Properties in conjunction with the sale. The parties have made customary representations, warranties, covenants and agreements in the Purchase Agreement

~~As a result of the disposition of our sugarcane land, we are no longer involved in sugarcane and the Improved Farmland segment is no longer material to our business.~~

~~Ranch and Conservation~~

~~The table below presents key operating measures for the three and nine months ended June 30, 2015 and 2014:~~

Three Months Ended Nine Months Ended
June 30, Change June 30, Change
2015 2014 $ % 2015 2014 $ %

Operating Revenues:
Sale of Calves $ 62 47 $ 15 31.9 % $ 171 $ 308 $ (137 ) (44.5 )%
Sale of Culls -   -   -   NM 511 692 (181 ) (26.2 )%
Land Leasing 197 311 (114 ) (36.7 )% 644 798 (154 ) (19.3 )%
Other 37 50 (13 ) (26.0 )% 115 51 64 125.5 %
Total $ 296 $ 408 $ (112 ) (27.5 )% $ 1,441 $ 1,849 $ (408 ) (22.1 )%

Pounds Sold:
Calves 29 30 (1 ) (3.3 )% 79 188 (109 ) (58.0 )%
Culls -   -   -   NM 446 794 (348 ) (43.8 )%

Price Per Pound:
Calves $ 2.14 $ 1.57 $ 0.57 36.3 % $ 2.16 $ 1.64 $ 0.52 31.7 %
Culls $ -   $ -   $ -   NM $ 1.15 $ 0.87 $ 0.28 32.2 %

Operating Expenses:
Cost of Calves Sold $ 3 $ 64 $ (61 ) (95.3 )% $ 6 $ 284 $ (278 ) (97.9 )%
Cost of Culls Sold -   100 (100 ) (100.0 )% 220 455 (235 ) (51.6 )%
Land Leasing Expenses 50 -   50 NM 176 157 19 12.1 %
Other 571 520 51 9.8 % 1,590 1,335 255 19.1 %
Total $ 624 $ 684 $ (60 ) (8.8 )% $ 1,992 $ 2,231 $ (239 ) (10.7 )%

NM - Not Meaningful

~~Ranch~~

~~Calves are generally~~historically been sold to market in the fourth quarter of ~~each~~the fiscal year. ~~Results~~We sold 786 calves in ~~each of~~the three months ended December 31, 2015. There were no culls sold in the three months ended December 31, 2015. The increase in gross profit for the three months ended December 31, 2015 as compared to the three months ended December 31, 2014 relates primarily to the increase in pounds sold, offset by no cull pounds sold in the first ~~second and third quarters~~fiscal quarter of ~~the fiscal years are immaterial and comparison of results is not meaningful.~~

2016.

Conservation

In December 2012, SFWMD issued a solicitation request for projects to be considered for the Northern Everglades Payment for Environmental Services Program. In March 2013, the Company submitted its response proposing a dispersed water management project on a portion of its ranch land.

On December 11, 2014, the SFWMD approved a contract with the Company. The contract term is eleven years and allows up to one year for implementation (design, permitting, construction and construction completion certification) and ten years of operation whereby the Company will provide water retention services. Payment for these services includes an amount not to exceed $4,000,000 of reimbursement for implementation. In addition, it provides for an annual fixed payment of $12,000,000 for operations and maintenance costs as long as the project is in compliance with the contract and subject to annual Board approval of funding. The contract specifies that the Board has to approve the payments annually, and there can be no assurance that it will approve the annual fixed payments. Operating expenses were approximately ~~$558,000~~$914,000 and ~~$480,000~~$487,000 for the three months ended ~~June 30,~~December 31, 2015 and 2014, ~~respectively, and were approximately $1,590,000 and $1,364,000 for the nine months ended June 30, 2015 and 2014,~~ respectively.

Other Operations

The ~~results~~decrease in Other Operations revenues is a result of the sale of our sugarcane operations and the corresponding reduction in land lease revenues from our former lease with United States Sugar Corporation. Operating expenses for Other Operations ~~segment for the three and nine months ended June 30, 2015 are in-line with the same period~~decreased by approximately $800,000 as a result of the ~~prior year.~~

~~Corporate,~~ sale of our sugarcane operations.

General and Administrative

The ~~increase~~decrease in corporate, general and administrative expenses for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2015 as compared to the three months ended December 31, 2014 relates primarily to professional and legal costs associated with the acquisitions, dispositions and mergers ~~described above in “Recent Events,”~~during the first fiscal quarter of 2015 which totaled approximately ~~$1,120,000~~$3,600,000. Additionally, in the three months ended December 31, 2015, we incurred approximately $1,400,000 in costs that were not incurred in the prior year same quarter. The costs included approximately $400,000 in legal costs related to shareholder litigation, $400,000 in write-off of an unsuccessful acquisition, $304,000 related to consulting and ~~$5,473,000~~non-competition agreements, and bonuses awarded to certain executives for fiscal 2015 performance that were approved in the current quarter.

Other (Expense) Income, net

Other (expense) income, net for the three ~~and nine~~ months ended June 30, 2015, respectively. The costs included $3,424,000 in legal costs, $1,036,000 in other real estate closing costs and $800,000 related to a consulting and non-competition agreement with the former CEO for the nine months ended June 30, 2015.

Corporate, general and administrative expenses for the three and nine months ended June 30, 2014 included costs incurred related to the change in control in November 2013, which totaled $261,000 and $2,266,000 for the three and nine months ended June 30, 2014, respectively. The costs included $195,000 for the acceleration of the vesting of the Long-Term Incentive Plan awards, $849,000 for the cost of Director and Officer insurance for the departing Directors and $583,000 related to a consulting and non-competition agreement with the former CEO for the nine months ended June 30, 2014.

~~Other Income (Expense), net~~

~~Other income (expense), net for the nine months ended June 30,~~December 31, 2015 is approximately ~~$10,000,000 greater~~$13,716,000 less than the same period of the prior year due to ~~an approximate $16,000,000~~a gain of approximately $13,613,000 on sale of ~~real estate~~the sugarcane land in the first quarter of fiscal 2015, offset by an increase of approximately ~~$6,000,000~~$1,125,000 in interest expense, due primarily to the term loan debt from the Orange-Co ~~acquisition.~~

acquisition in place for a full quarter in fiscal 2016.

(Benefit) Provision for Income Taxes

Income tax benefit was approximately ($2,075,000) and income tax expense was approximately ~~$6,227,000 and $791,000~~$3,763,000 for the three months ended ~~June 30,~~December 31, 2015 and 2014, respectively. The Company’s effective income tax rates were ~~44.5%~~40.7% and ~~43.4%~~41.9% for the three months ended ~~June 30,~~December 31, 2015 and 2014, respectively. ~~Income tax expense was approximately $10,940,000 and $3,236,000 for the nine months ended June 30, 2015 and 2014, respectively.~~

The ~~Company’s effective income tax rates for the nine months ended June 30, 2015 and 2014 were 37.4% and 39.2%, respectively.~~

During the three months ended June 30, 2015, the Company revised effective tax rates to reflect the impact of claiming certain deductions on amended federal and state income tax returns filed for the fiscal years ended September 30, 2011 through September 30, 2013. Other changes to the effective tax rates relate primarily to the nondeductible nature of projected political contributions and lobbying expenses. In addition, there were limitations on certain deductions related to the vesting of the long-term incentive grants for fiscal year 2014, and non-deductible transaction costs related to the Silver Nip Citrus merger for fiscal year 2015

~~The IRS~~Internal Revenue Service ("IRS") is currently auditing the Company’s tax ~~returns~~return for the fiscal year ended September 30, 2013. Audits for fiscal years ended September 30, ~~2013,~~ 2012 and ~~2011.~~

2011 have been finalized and our returns were accepted as filed.

Seasonality

Historically, the second and third quarters of our fiscal year produce the majority of our annual revenue, and our working capital requirements are typically greater in the first and fourth quarters of our fiscal year coinciding with our harvesting cycles. Because of the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year.

Non-GAAP Financial Measures

~~Alico~~

The Company utilizes Adjusted ~~EBITDA~~Earnings before interest, tax, depreciation and amortization ("EBITDA") among other measures, to evaluate the performance of its business. Due to significant depreciable assets associated with the nature of our operations and, to a lesser extent, interest costs associated with our capital structure, management believes that Adjusted EBITDA, Adjusted Earnings per Diluted Common Share, Adjusted Free Cash Flow and Adjusted Free Cash Flow per Diluted Common Share are important measures to evaluate our results of operations between periods on a more comparable basis and to help investors analyze underlying trends in our business, evaluate the performance of our business both on an absolute basis and relative to our peers and the broader market, provides useful information to both management and investors by excluding certain items that may not be indicative of our core operating results and operational strength of our business and helps investors evaluate our ability to service our debt. Tax impacts are computed based on the effective rate for the ~~nine~~three months ended ~~June 30,~~December 31, 2015. Such measurements are not prepared in accordance with ~~accounting principles generally accepted in the United States (“~~U.S. ~~GAAP”)~~GAAP and should not be construed as an alternative to reported results determined in accordance with U.S. GAAP. The non-U.S. GAAP information provided is unique to ~~Alico~~the Company and may not be consistent with methodologies used by other companies. Adjusted Free Cash Flow is defined as cash provided by (used in) operations less capital expenditures adjusted for non-recurring transactions. The Company uses Adjusted Free Cash Flow and Adjusted Free Cash Flow per Diluted Common Share to evaluate its business and this measure is considered an important indicator of the Company's liquidity, including its ability to reduce net debt, make strategic investments and pay dividends to common stockholders. An analysis of Adjusted Free Cash Flow and Adjusted Free Cash Flow per Common Share is provided below. Net income ~~which management considers being the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP,~~attributable to common stockholders is reconciled to Adjusted EBITDA and Adjusted Earnings per Diluted Common Share, as follows:

Adjusted EBITDA
(in thousands)
Three Months Ended June 30, Nine Months Ended June 30,
2015 2014 2015 2014

Net income $ 7,767 $ 1,031 $ 18,292 $ 5,023
Interest expense 2,127 657 5,715 1,322
Income tax provision 6,227 791 10,940 3,236
Depreciation and amortization 3,851 2,305 9,919 7,244

EBITDA 19,972 4,784 44,866 16,825
Asset impairment -   -   541 -
Loss on extinguishment of debt -   -   964 -
Transaction costs 407 261 4,760 2,266
Write-off of certain inventory and plant cane costs -   2,309 -   2,309
Acquired citrus inventory fair value adjustments 3,023 -   7,225 -
Payments on consulting agreements 704 -   704 -
Loss (gain) on sale of assets 27 (4 ) (16,397 ) (3 )

Adjusted EBITDA $ 24,133 $ 7,350 $ 42,663 $ 21,397

Adjusted Earnings Per Diluted Common Share
(in thousands)

Net income $ 7,767 $ 1,031 $ 18,292 $ 5,023
Asset impairment -   -   541 -
Loss on extinguishment of debt -   -   964 -
Transaction costs 407 261 4,760 2,266
Write-off of certain inventory and plant cane costs -   2,309 -   2,309
Acquired citrus inventory fair value adjustments 3,023 -   7,225 -
Payments on consulting agreements 704 -   704 -
Loss (gain) on sale of assets 27 (4 ) (16,397 ) (3 )
Tax impact (1,594 ) (1,030 ) 824 (1,792 )

Adjusted net income $ 10,334 $ 2,567 $ 16,913 $ 7,803

Dilutive common shares 8,284 7,356 7,971 7,351

Adjusted Earnings Per Diluted Common Share $ 1.25 $ 0.35 $ 2.12 $ 1.06

Adjusted Free Cash Flow
(in thousands)

Cash provided by operations $ 32,156 $ 10,144 $ 25,895 $ 14,770
Adjustments for non-recurring items:
Transaction costs 407 261 4,760 2,266
Payments on consulting agreements 704 -   704 -

Capital expenditures (4,059 ) (2,497 ) (9,674 ) (11,255 )

Adjusted Free Cash Flow $ 29,208 $ 7,908 $ 21,685 $ 5,781

Dilutive common shares 8,284 7,356 7,971 7,351

Adjusted Free Cash Flow Per Diluted Common Share $ 3.53 $ 1.08 $ 2.72 $ 0.79

Adjusted EBITDA



(in thousands)
	Three Months Ended December 31,
	2015			2014

Net (loss) income attributable to common stockholders	$	(3,011	)	$	5,206
Interest expense	2,503			1,378
(Benefit) provision for income taxes	(2,075		)	3,763
Depreciation and amortization	4,008			2,984
EBITDA	1,425			13,331

Transaction costs	397			3,579
Loss on extinguishment of debt	—			947
Payments on consulting agreements	304			—
Litigation expenses related to shareholder lawsuit	400			—
Gains on sale of real estate	(142		)	(13,497		)

Adjusted EBITDA	$	2,384		$	4,360

Adjusted Earnings per Common Share



(in thousands)
	Three Months Ended December 31,
	2015			2014

Net (loss) income attributable to common stockholders	$	(3,011	)	$	5,206
Loss on extinguishment of debt	—			947
Transaction costs	397			3,579
Litigation expenses related to shareholder lawsuit	400			—
Payments on consulting agreements	304			—
Gains on sale of real estate	(142		)	(13,497		)
Tax impact	(391		)	3,764

Adjusted net loss	$	(2,443	)	$	(1	)

Diluted common shares	8,303			7,367

Adjusted Earnings per Diluted Common Share	$	(0.29	)	$	—

Free Cash Flow



(in thousands)
	Three Months Ended December 31,
	2015			2014

Net cash used in operating activities	$	(14,781	)	$	(16,446	)
Adjustments for non-recurring items:
Transaction costs	397			3,579
Payments on consulting agreements	304			—
Litigation expenses related to shareholder lawsuit	400			—
Capital expenditures	(2,988		)	(1,808		)
Adjusted Free Cash Flow	$	(16,668	)	$	(14,675	)

Diluted common shares	8,303			7,367

Adjusted Free Cash Flow per Diluted Common Share	$	(2.01	)	$	(1.99	)

Liquidity and Capital Resources

A comparative balance sheet summary is presented in the following table:

(in thousands) June 30, September 30,
2015 2014 Change

Cash and cash equivalents $ 9,739 $ 31,020 $ (21,281 )
Investments $ - $ 263 $ (263 )
Total current assets $ 78,675 $ 125,710 $ (47,035 )
Total current liabilities $ 20,043 $ 20,669 $ (626 )
Working capital $ 58,632 $ 105,041 $ (46,409 )
Total assets $ 470,222 $ 257,578 $ 212,644
Term loans and lines of credit $ 209,928 $ 64,800 $ 145,128
Current ratio 3.93 6.08 (2.15 )

Our operations have historically generated positive net cash flow from operating activities. Sources of cash primarily include cash flow from operations, amounts available under our revolving and working capital credit facilities and access to capital markets. Our access to additional borrowings under the Revolving Credit Facility is subject to the satisfaction of customary borrowing conditions, including the absence of any event or circumstance having a material adverse effect on our business. As a public company, we may have access to other sources of capital such as the public bond markets. However, our access to, and the availability of, financing on acceptable terms in the future will be affected by many factors, including (i) our financial condition, prospects and credit rating, (ii) the liquidity of the overall capital markets and (iii) the state of the economy. There can be no assurance that we will continue to have access to the capital markets on acceptable terms or at all.

The principal uses of cash that affect our liquidity position include the following: operational expenditures including employee costs, the cost of maintaining our citrus groves, harvesting and hauling of our citrus products, capital expenditures, income tax payments, acquisitions, dividends, and debt service costs including interest and principal payments on our term loans and credit facilities. In addition to the acquisitions and dispositions disclosed elsewhere, we have evaluated and expect to continue to evaluate possible acquisitions and dispositions of certain businesses. Such transactions may be material and may involve cash, the issuance of other securities or the assumption of indebtedness.



(in thousands)	December 31,		September 30,
	2015		2015		Change
Cash and cash equivalents	$	3,276	$	5,474	(2,198	)
Total current assets	$	82,060	$	70,763	11,297
Total current liabilities	$	17,584	$	24,135	(6,551	)
Working capital	$	64,476	$	46,628	17,848
Total assets	$	468,982	$	460,088	8,894
Term loans and line of credit	$	227,913	$	205,481	22,432
Current ratio	4.67 to 1		2.93 to 1

We believe that a combination of our cash-on-hand, cash generated from ~~operating activities,~~operations and availability under our ~~revolving~~lines of credit ~~facilities~~ will provide us with sufficient liquidity to service the principal and interest payments on our indebtedness, satisfy our working capital requirements and capital expenditures for at least the next 12twelve months and over the long term. We have ~~$76,000,000 in~~a $70,000,000 working capital ~~lines~~line of credit, of which ~~$55,153,500~~approximately $30,884,000 is available for our general use as of ~~June 30,~~December 31, 2015 and a $25,000,000 revolving line of credit all of which is available for our general use as of ~~June 30,~~December 31, 2015 (see ~~“Note 7”~~Note 6 “Long-Term Debt and Lines of Credit" to the accompanying Condensed Combined Consolidated Financial Statements). If the Company pursues significant growth opportunities in the future, it could have a material adverse impact on our cash balances and we may need to finance such activities by drawing down monies under our lines of credit ~~and if necessary,~~or obtaining additional debt or equity financing.

~~Our level of debt~~ There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. Any inability to obtain additional financing could have important consequences on our business, including, but not limited to, increasing our vulnerability to general adverse economic and industry conditions, limiting the availability of our cash flow to fund future investments, capital expenditures, working capital, business activities and other general corporate requirements and limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate. These events would adversely impact our ~~results of operations, cash flows and financial position.~~

ability to pursue different growth opportunities.

~~Cash Flows~~

~~The decrease in cash and cash equivalents was primarily due to the following factors:~~

~~Capital expenditures of $9,674,000;~~

~~Acquisition of Citrus groves (Orange-Co and TRB) of $283,211,000 offset by $145,000,000 in refinanced debt;~~

~~Payment on revolving credit lines of $80,947,000; and~~

~~Principal payments on long-term debt of $15,061,000~~.

Net Cash ~~Provided By~~Used In Operating Activities

The following table details the items contributing to Net Cash ~~Provided by~~Used in Operating Activities for the ~~nine~~three months ended ~~June 30,~~December 31, 2015 and 2014:

(in thousands) Nine Months Ended June 30,
2015 2014 Change

Net income $ 18,292 $ 5,023 $ 13,269
Depreciation and amortization 9,919 7,244 2,675
(Gain) loss on sale of assets (17,087 ) 638 (17,725 )
Other non-cash expenses 16,285 1,562 14,723
Change in working capital (1,514 ) 303 (1,817 )

Cash provided by operating activities $ 25,895 $ 14,770 $ 11,125



	Three Months Ended
(in thousands)	December 31,
	2015			2014			Change
Net (Loss) Income	$	(3,011	)	$	5,206		$	(8,217	)
Depreciation and Amortization	4,008			2,984			1,024
Net (gain) loss on Sale of Property and Equipment	128			(13,701		)	13,829
Other non-cash expenses	613			187			426
Change in working capital	(16,519		)	(11,122		)	(5,397		)
Cash used in operating activities	$	(14,781	)	$	(16,446	)	$	1,665

The factors contributing to the ~~increase~~decrease in net income for the ~~nine~~three months ended ~~June 30,~~December 31, 2015, versus the same period of the prior year are discussed in ~~“Results~~“Condensed Combined Consolidated Statements of ~~Operations.~~Comprehensive Income.” The gain on sale of ~~assets~~property and equipment in the three months ended December 31, 2014 is ~~substantially~~ due to the recognition of approximately $13,613,000 associated with the ~~Sugarcane~~sugarcane land sale as discussed in~~Recent Events~~.

Note 4. Acquisitions and Dispositions to the Condensed Combined Consolidated Financial Statements.

Due to the seasonal nature of our business, working capital requirements are typically greater in the first and fourth quarters of our fiscal ~~year coinciding with our harvest cycles.~~year. Cash flows from operating activities typically improve in our second and third fiscal quarters as we harvest our citrus crops.

Net Cash Used In Investing Activities

The following table details the items contributing to Net Cash Used in Investing Activities for the ~~nine~~three months ended ~~June 30,~~December 31, 2015 and 2014:

(in thousands) Nine Months Ended June 30,
2015 2014 Change

Capital expenditures
Sugarcane planting $ -   $ (2,792 ) $ 2,792
Improvements to farmland (2,406 ) (937 ) (1,469 )
Citrus nursery (2,944 ) (4,783 ) 1,839
Citrus tree development (493 ) (733 ) 240
Breeding herd purchases (509 ) (752 ) 243
Rolling stock, equipment and other (2,347 ) (1,258 ) (1,089 )
Other (975 ) -   (975 )

Total $ (9,674 ) $ (11,255 ) $ (1,581 )
-   -
Acquisition of Citrus business $ (283,211 ) $ -   $ (283,211 )
Proceeds from sale of assets 106,196 928 105,268
Return on investment in Magnolia Fund 652 3,185 (2,533 )
Other (1 ) 27 (28 )

Cash used in investing activities $ (186,038 ) $ (7,115 ) $ (178,923 )

~~Capital expenditures decreased~~



	Three Months Ended
(in thousands)	December 31,
	2015			2014			Change
Capital expenditures:
Citrus nursery	$	(41	)	$	(1,248	)	$	1,207
Citrus tree development	(1,529		)	(117		)	(1,412		)
Breeding herd purchases	(620		)	(164		)	(456		)
Rolling stock, equipment and other	(659		)	(279		)	(380		)
Other	(139		)	—			(139		)
Total	$	(2,988	)	$	(1,808	)	$	(1,180	)

Acquisition of Citrus business	$	—		$	(265,063	)	$	265,063
Proceeds from sale of assets	—			97,151			(97,151		)
Other	140			361			(221		)
Cash used in investing activities	$	(2,848	)	$	(169,359	)	$	166,511

The decrease in net cash used in investing activities for the three months ended December 31, 2015, as compared to the three months ended December 31, 2014, was primarily due to (i) the ~~disposition~~acquisition of ~~our sugarcane land. We are no longer involved in sugarcane and therefore no sugarcane plantings or improvements to farmland took place in the nine months ended June 30, 2015.~~

~~Additionally, we acquired~~ Orange-Co for approximately ~~$265,587,000~~$265,063,000 in December 2014 ~~(see “Note 4” to the accompanying Condensed Combined Consolidated Financial Statements) and utilized~~utilizing proceeds from the disposition of our sugarcane land of ~~$97,151,000 from~~approximately $97,126,000 via a tax deferred ~~like-kind~~like kind exchange pursuant to Internal Revenue Code Section ~~§1031~~1031 (see ~~“Note 4”~~Note 4. “Acquisitions and Dispositions" to the accompanying Condensed Combined Consolidated Financial ~~Statements ). In addition, Silver Nip acquired a citrus grove of approximately 1,500 acres in Charlotte County, Florida for $17,624,000.~~

Statements).

Net Cash Provided By ~~(Used In)~~ Financing Activities



	Three Months Ended
(in thousands)	December 31,
	2015			2014			Change
Proceeds from term loans	$	—		$	182,555		$	(182,555	)
Repayments on revolving line of credit	$	—		$	(22,309	)	$	22,309
Borrowings on revolving line of credit	24,986			36,319			(11,333		)
Repayment of term loan	—			(34,000		)	34,000
Principal payments on term loans	(2,699		)	(290		)	(2,409		)
Contingent consideration paid	(3,750		)	—			(3,750		)
Treasury stock purchases	$	(2,602	)	$	—		$	(2,602	)
Financing costs	—			(2,834		)	2,834
Dividends paid	$	(504	)	$	(442	)	$	(62	)
Distributions to members	—			(458		)	458
Cash provided by financing activities	15,431			158,541			(143,110		)

The ~~following table details the items contributing to Net Cash Provided By (Used In) Financing Activities~~decrease in net cash provided by financing activities for the ~~nine~~three months ended ~~June 30,~~December 31, 2015, ~~and 2014:~~

(in thousands) Nine Months Ended June 30,
2015 2014 Change

Principal payments on term loan $ (15,061 ) $ (3,041 ) $ (12,020 )
Repayment of term loan (34,000 ) -   (34,000 )
Borrowings on revolving line of credit 81,135 -   81,135
Repayments on revolving line of credit (80,947 ) -   (80,947 )
Proceeds from term loans 193,500 -   193,500
Financing costs (3,353 ) -   (3,353 )
Treasury stock purchases (1,029 ) (4,844 ) 3,815
Dividends paid (1,381 ) (2,744 ) 1,363
Principal payments on capital lease obligation (2 ) -   (2 )

Cash provided by (used in) financing activities $ 138,862 $ (10,629 ) $ 149,491

~~The Company~~as compared to the three months ended December 31, 2014, was primarily due to (i) net proceeds from the Company’s restructured ~~its outstanding~~long-term debt on December 3, 2014, in connection with the Orange-Co acquisition (see ~~“Note 7”~~Note 6. “Long-term Debt and Lines of Credit” to the accompanying Condensed Combined Consolidated Financial Statements). The restructured ~~debt~~credit facilities ~~include $113,125,000~~included $125,000,000 in fixed ~~rate term loans, $56,063,000 in variable~~interest rate term loans and ~~a $25,000,000 revolving~~$57,500,000 in variable interest rate term loans. The proceeds of the new credit facilities were partially offset by the repayment of an existing $33,500,000 variable interest rate term loan.

We drew approximately $24,986,000 on our WCLC primarily to fund our working capital requirements and investing activities for the quarter ended December 31, 2015. The increase in term loan repayments for the quarter ended December 31, 2015 relates to the restructured long-term debt described above.

The WCLC agreement provides for Rabo to issue up to $20,000,000 in letters of credit on the Company’s behalf. As of December 31, 2015, there was approximately $13,984,000 in outstanding letters of credit which correspondingly reduced our availability under the line of ~~credit (“RLOC”)~~credit. The outstanding balance on the WCLC was approximately $25,132,000 as of December 31, 2015. On January 19, 2016, $25,000,000 was transferred from the WCLC to the RLOC and has been classified as non-current at December 31, 2015 in accordance with ~~Metropolitan Life Insurance Company and New England Life Insurance Company (collectively “Met”) and~~FASB ASC 470-10, "Debt." The remaining $132,000 balance on the WCLC has been classified as a ~~$70,000,000 working capital line~~current liability at December 31, 2015.

On December 1, 2015, we paid $3,750,000 of additional consideration on the Orange-Co acquisition as contemplated by the Orange-Co Purchase Agreement. Our $7,500,000 irrevocable letter of credit ~~(“WCLC”) with Rabo.~~

~~The previous term loan required quarterly principal payments of $500,000. The balance~~securing the payment of the ~~term loan~~additional consideration expired and was ~~$34,000,000 at~~replaced with a new letter of credit in the ~~time it was refinanced in connection with~~amount of $3,750,000 securing the ~~Orange-Co acquisition.~~

final payment due on June 1, 2016 subject to certain limitations.

Purchase Commitments

~~Alico,~~

The Company, through its wholly owned subsidiary Alico Fruit Company, enters into contracts for the purchase of citrus fruit during the normal course of its business. The remaining obligations under these purchase agreements ~~totaled~~were approximately ~~$4,047,855~~$3,709,495 as of ~~June 30,~~December 31, 2015 for delivery in fiscal year 2016. ~~These contractual~~All of these obligations are covered by sales agreements. ~~Alico’s~~The Company’s management currently believes that all committed purchase volume will be sold at cost or higher.

Contractual Obligations and Off Balance Sheet Arrangements

There have been no material changes during this reporting period to the disclosures set forth in Part II, Item 7 in our Annual ~~report~~Report on Form 10-K for the fiscal year ended September 30, ~~2014.~~

2015.

~~ITEM~~

Item 3.Quantitative and Qualitative Disclosures about Market ~~Risk~~

Risk.

There have been no material changes during this reporting period in the disclosures set forth in Part II, Item 7A in our Annual Report on Form 10-K for the fiscal year ended September 30, ~~2014,~~2015, filed with the SEC on December ~~12, 2014.~~

10, 2015.

~~ITEM~~

Item 4. Controls and ~~Procedures~~

~~(a)~~ Procedures.


(a)	Evaluation of Disclosure Controls and Procedures.

Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the our disclosure controls and procedures

As as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) as of the end of the period covered by this report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, an evaluation, as required by Rules 13a-15 and 15d-15 of the Securities Exchange Act of 1934 as amended (“Exchange Act”), was carried out under the supervision and with the participation of our management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of our disclosure controls and procedures. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the design and operation of our disclosure controls and procedures ~~are effective to ensure that all information required to be disclosed~~were effective.


(b)	Changes in Internal Control over Financial Reporting.

During the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and to provide reasonable assurance that information required to be disclosed by us in such reports is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

~~(b) Changes in internal control over financial reporting~~

~~There have been~~first quarter ended December 31, 2015, there were no changes in our internal ~~control~~controls over financial reporting ~~identified in connection with the evaluation required by paragraph (d) of Rule 13a-15(f) or Rule 15d-15(f) under the Exchange Act that occurred during our last fiscal quarter~~ that have materially affected or isare reasonably likely to materially affect, our internal control over financial reporting.

PART ~~II.~~II OTHER INFORMATION

~~ITEM~~

Item 1. Legal Proceedings.

On October 16, 2015, the lead plaintiff in the Consolidated Action reported to the court that the parties reached an agreement in principle to settle the Consolidated Action and other claims related to the Acquisition, and that they are in the process of formally documenting their agreements. That process is ongoing and the settlement remains subject to final documentation and court approval following notice to the relevant Alico shareholders. Once the parties have completed the settlement documentation, they will contact the court to schedule a hearing at which they will request the court to preliminarily approve the settlement and to set a final settlement hearing date.

~~ITEM~~

Item 1A.Risk Factors.

There have been no material changes in the risk factors set forth in Part 1, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, ~~2014,~~2015, as filed with the SEC on December ~~12, 2014.~~

10, 2015.

~~ITEM~~

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

There were no sales of unregistered equity securities during the period.

In ~~March~~fiscal year 2015, the Board of Directors authorized the repurchase of up to ~~20,000~~170,000 shares of the Company’s common stock beginning March ~~25,~~26, 2015 and continuing through ~~March 25, 2016.~~December 31, 2016 (the "2015 Authorization"). The stock repurchases were made through open market transactions at times and in such amounts as the Company’s broker determined subject to the provisions of SEC Rule 10b-18. The Company also adopted a Rule 10b5-1 share repurchase plan under the Securities Exchange Act of 1934 (the “Plan”) in connection with its share repurchase authorization. The Plan allows the Company to repurchase its shares at times when it otherwise might be prevented from doing so under insider trading laws or because of self-imposed trading blackout periods.

For the ~~nine~~three months ended ~~June 30,~~December 31, 2015, the Company had purchased 64,136 shares all ~~20,000~~in accordance with the 2015 Authorization and had available to purchase an additional 14,310 shares in accordance with the ~~authorization.~~2015 Authorization. The following table describes our purchases of our common stock during the three months ended through ~~June 30,~~December 31, 2015.

Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased As Part of Publicly Announced Plans or Programs Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs

Month of March 2015 9,907 $ 51.64 9,907 10,093
Month of April 2015 10,093 $ 49.27 10,093 -



	Total			Total Number of Shares	Maximum Number of
	Number of	Average		Purchased As Part of	Shares that May Yet Be
	Shares	Price Paid		Publicly Announced	Purchased Under the
	Purchased	Per Share		Plans Or Programs	Plans or Programs

Month of October 2015	10,685	$	41.40	—	67,761
Month of November 2015	24,613	$	41.38	24,613	43,148
Month of December 2015	28,838	$	39.59	28,838	14,310

~~ITEM~~

Item 3. Defaults Upon Senior Securities.

None.

~~ITEM~~

Item 4. Mine Safety Disclosure.

Not ~~Applicable~~

Applicable.

~~ITEM~~

Item 5. Other Information.

~~None.~~

None.

~~ITEM~~

Item 6. ~~Exhibits~~

Exhibits.



Exhibit ~~No.~~ Number		~~Description of~~ Exhibit
			Index
2.1	***	Asset Purchase Agreement, ~~dates~~dated as of December 1, 2014, by and among Alico, Inc., Orange-Co, ~~L.P.~~LP, and, solely with respect to certain sections thereof, Orange-Co, LLC and Tamiami Citrus, LLC. (Incorporated by reference to Exhibit 2.1 of Alico’s filing on Form 8-K dated December 5, 2014).	~~Previously filed~~

2.2	***	Agreement and Plan of Merger, dated as of December 2, 2014, by and among Alico, Inc., 734 Sub, LLC, 734 Citrus Holdings, LLC, and, solely with respect to certain sections thereof, 734 Agriculture, LLC, Rio Verde Ventures, LLC and Clayton G. Wilson. (Incorporated by reference to Exhibit 2.2 of Alico’s filing on Form 8-K dated December 5, 2014).	~~Previously filed~~
3.1		Restated Certificate of Incorporation, Dated February 17, 1972 (incorporated by reference to Alico’s Registration Statement on Form S-1 dated February 24, 1972, Registration No. 2-43156)
3.2
~~10.1~~	*	~~First Amended and Restated Credit Agreement,~~Certificate of Amendment to Certificate of Incorporation, Dated January 14, 1974 (incorporated by reference to Alico’s Registration Statement on Form S-8, dated December ~~1, 2014,~~21, 2005, Registration No. 333-130575)
3.3		Amendment to Articles of Incorporation, Dated January 14, 1987 (incorporated by ~~and among~~reference to Alico’s Registration Statement on Form S-8, dated December 21, 2005, Registration No. 333-130575)
3.4		Amendment to Articles of Incorporation, Dated December 27, 1988 (incorporated by reference to Alico’s Registration Statement on Form S-8, dated December 21, 2005, Registration No. 333-130575)
3.5		By-Laws of Alico, Inc., ~~Alico Land Development, Inc., Alico-Agri, Ltd., Alico Plant World, L.L.C., Alico Fruit Company, LLC, Metropolitan Life Insurance Company,~~amended and ~~New England Life Insurance Company.~~restated (Incorporated by reference to Exhibit ~~10.1~~3.1 of ~~Alico’s filing~~the Company’s current report on Form 8-K, ~~dated December 5, 2014).~~	~~Previously~~ filed

~~10.2~~	*	Credit Agreement, by and between Alico, Inc., Alico-Agri, Ltd., Alico Plant World, L.L.C., Alico Fruit Company, LLC, Alico Land Development, Inc., and Alico Citrus Nursery, LLC, as Borrowers and Rabo Agrifinance, Inc., as Lender. (Incorporated by reference to Exhibit 10.2 of Alico’s filing with the Commission on ~~Form 8-K dated December 5, 2014).~~	~~Previously filed~~

~~10.3~~		~~Separation and Consulting Agreement dated March 30, 2015, by and between Alico, Inc. and Ken Smith.~~	~~Filed herewith~~

~~10.4~~		~~Employment Agreement, dated as of April 20, 2015, by and between Alico, Inc. and Clayton G. Wilson. (Incorporated by reference to Exhibit 10.1 of Alico’s filing on Form 8-K dated April 21, 2015).~~	~~Previously filed~~

~~10.5~~		~~Employment Agreement, dated as of June 1, 2015, by and between Alico, Inc. and John E. Kiernan. (Incorporated by reference to Exhibit 10.1 of Alico’s filing on Form 8-K dated June 1, 2015).~~	~~Previously filed~~

~~10.6~~		~~Separation and Consulting Agreement dated as of June 1, 2015, by and between Alico, Inc. and W. Mark Humphrey.~~	~~Filed herewith~~
			January 25, 2013)
31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of ~~2002.~~	~~Filed herewith~~
			2002 Rule 13a-14(a) certification
31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of ~~2002.~~	~~Filed herewith~~
			2002 Rule 13a-14(a) certification
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section ~~1350.~~	~~Furnished herewith~~
			1350
32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section ~~1350.~~	~~Furnished herewith~~1350
101.0
101.INS	**	XBRL Instance Document	~~Filed herewith~~

101.SCH	**	XBRL Taxonomy Extension Schema Document	~~Filed herewith~~

101.CAL	**	XBRL Taxonomy Calculation Linkbase Document	~~Filed herewith~~

101.DEF	**	XBRL Taxonomy Definition Linkbase Document	~~Filed herewith~~

101.LAB	**	XBRL Taxonomy Label Linkbase Document	~~Filed herewith~~


101.PRE	**	XBRL Taxonomy Extension Presentation Linkbase Document	~~Filed herewith~~

*	Certain schedules and exhibits have been omitted from this filing pursuant to Item 601 (b)(2) of Regulation S-K, the Company will furnish supplemental copies of any such schedules or exhibits to the Securities and Exchange Commission upon request.

**	In accordance with Rule 406T of Regulation S-T, these XBRL (eXtensible Business Reporting Language) documents are furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability under these sections.
***	Certain schedules and exhibits have been omitted from this filing pursuant to Item 601(b) (2) of Regulation S-K. The Company will furnish supplemental copies of any such schedules or exhibits to the SEC upon request.

33
~~SIGNATURES~~

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


			~~ALICO, INC.~~
				ALICO, INC. (Registrant)

February 8, 2016	By:		/s/ Clayton G. Wilson

~~Date: August 5, 2015~~		~~By:~~	~~/s/ Clayton G. Wilson~~
			Clayton G. Wilson
			President and Chief Executive Officer

February 8, 2016	By:		/s/ John E. Kiernan

~~Date: August 5, 2015~~		~~By:~~	~~/s/ John E. Kiernan~~
			John E. Kiernan
			Senior Vice President and Chief Financial Officer

☑

þ	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended ~~June 30,~~December 31, 2015

or
		or


☐
¨	Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ~~_____________ to _____________~~
from		to



Florida	59-0906081
(State or other jurisdiction of	~~(I.R.S. Employer~~
incorporation or organization)	(I.R.S. Employer Identification No.)

10070 Daniels Interstate Court Suite 100 Fort Myers, FL	~~33913~~
(Address of principal executive offices)	33913 (Zip Code)



Large accelerated ~~file ☐~~ filer	¨	Accelerated filer ☑	þ
Non-accelerated filer ☐	¨	Smaller ~~reporting company ☐~~
Reporting Company	~~(Do not check if a smaller reporting company)~~¨

		~~Page~~

Part I.	I - FINANCIAL INFORMATION

Item 1.	Condensed Combined Consolidated Financial Statements (Unaudited)	1
	~~Condensed Combined Consolidated Statements of Operations and Comprehensive Income for the Three and Nine Months Ended June 30, 2015 and 2014 (unaudited)~~	1
	~~Condensed Combined Consolidated Balance Sheets as of June 30, 2015 (unaudited) and September 30, 2014 (unaudited)~~	2
	~~Condensed Combined Consolidated Statements of Cash Flows for the Three and Nine Months Ended June 30, 2015 and 2014 (unaudited)~~	3
	~~Notes to the Condensed Combined Consolidated Financial Statements~~	4
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	20 18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	36 30
Item 4.	Controls and Procedures	36 30
	Part II - OTHER INFORMATION
~~Part II.~~ Item 1. Legal Proceedings	~~OTHER INFORMATION~~31
Item 1A. Risk Factors		31
~~Item 1.~~	~~Legal Proceedings~~	37
~~Item 1A.~~	~~Risk Factors~~	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37 31
Item 3.	Defaults Upon Senior Securities	37 32
Item 4.	Mine Safety Disclosures	37 32
Item 5.	Other Information	37 33
Item 6. Exhibits	~~Exhibits~~33
Signatures	38 34



	Page
~~Signatures~~Condensed Combined Consolidated Statements of Operations and Comprehensive Income (Unaudited)	39 1

Condensed Combined Consolidated Balance Sheets (Unaudited)	2
Condensed Combined Consolidated Statement of Cash Flows (Unaudited)	3
Notes to Condensed Combined Consolidated Financial Statements (Unaudited)	4

	Three Months Ended June 30,						Nine Months Ended June 30,
	2015			2014			2015			2014
	(unaudited)						(unaudited)
Operating revenues:
Citrus Groves	$	65,795		$	27,167		$	129,084		$	55,390
Agricultural Supply Chain Management		2,105			4,083			6,584			12,324
Improved Farmland		418			2,159			2,492			19,441
Ranch and Conservation		296			408			1,441			1,849
Other Operations		195			58			508			502
Total operating revenue		68,809			33,875			140,109			89,506

Operating expenses:
Citrus Groves		45,551			18,317			96,027			36,560
Agricultural Supply Chain Management		1,467			3,916			5,578			12,085
Improved Farmland		659			6,591			2,736			20,986
Ranch and Conservation		624			684			1,992			2,231
Other Operations		693			(226	)		786			281
Total operating expenses		48,994			29,282			107,119			72,143

Gross profit		19,815			4,593			32,990			17,363
Corporate, general and administrative		3,638			2,339			12,932			7,961

Income from operations		16,177			2,254			20,058			9,402

Other income (expense), net:
Interest and investment income, net		42			88			44			115
Interest expense		(2,127	)		(657	)		(5,715	)		(1,322	)
Loss on extinguishment of debt		-			-			(964	)		-
Gain (loss) on sale of real estate		(27	)		4			16,397			3
Asset impairment		-			-			(541	)		-
Other income (loss), net		(71	)		133			(47	)		61
Total other income (expense), net		(2,183	)		(432	)		9,174			(1,143	)

Income before income taxes		13,994			1,822			29,232			8,259
Income taxes		6,227			791			10,940			3,236

Net income		7,767			1,031			18,292			5,023
Net income (loss) attributable to noncontrolling interests		-			-			-			-

Net income attributable to Alico, Inc. common stockholders		7,767			1,031			18,292			5,023
Other comprehensive income (loss), net of tax		-			-			-			-
Comprehensive income		7,767			1,031			18,292			5,023
Comprehensive income (loss) attributable to noncontrolling interest		-			-			-			-
Comprehensive income attributable to Alico, Inc. common stockholders	$	7,767		$	1,031		$	18,292		$	5,023

Earnings per common share:
Basic	$	0.94		$	0.14		$	2.30		$	0.69
Diluted	$	0.94		$	0.14		$	2.29		$	0.68
Weighted-average number of common shares outstanding:
Basic		8,278			7,356			7,969			7,327
Diluted		8,284			7,356			7,971			7,351

Cash dividends declared per common share	$	0.06		$	0.06		$	0.18		$	0.18

	June 30, 2015			September 30, 2014
	(unaudited)			(unaudited)

ASSETS
Current assets:
Cash and cash equivalents	$	9,739		$	31,020
Short-term investments		-			263
Accounts receivable, net		15,103			8,724
Inventories, net		46,255			25,469
Income tax receivable		2,074			-
Assets held for sale		-			59,513
Other current assets		5,504			721
Total current assets		78,675			125,710

Property, buildings and equipment, net		383,100			126,833
Goodwill		2,246			-
Investment in Magnolia Fund		825			1,435
Cash surrender value of life insurance		705			695
Investments, deposits and other assets		4,671			2,905
Total assets	$	470,222		$	257,578


LIABILITIES & EQUITY
Current liabilities:
Accounts payable	$	3,352		$	2,052
Long-term debt, current portion		4,511			3,196
Accrued expenses		7,941			1,934
Income taxes payable		-			4,572
Deferred tax liability, current portion		725			3,135
Dividends payable		497			442
Accrued ad valorem taxes		1,757			1,850
Capital lease obligation, current portion		258			259
Other current liabilities		1,002			3,229
Total current liabilities		20,043			20,669

Long-term debt, net of current portion		202,069			58,444
Lines of credit		3,348			3,160
Deferred gain on sale of assets, net of current portion		29,139			-
Capital lease obligation, net of current portion		839			839
Deferred tax liability, net of current portion		23,595			8,760
Deferred retirement benefits		3,895			3,855
Other liabilities		3,867			-
Total liabilities		286,795			95,727

Commitments and contingencies (Note 11)

Equity:
Preferred stock, no par value, 1,000,000 shares authorized; none issued		-			-
Common stock, $1 par value; 15,000,000 shares authorized, 8,300,363 and 7,377,106 shares issued and 8,277,513 and 7,361,340 shares outstanding as of June 30, 2015 and September 30, 2014, respectively		8,300			7,377
Additional paid-in-capital		21,360			3,742
Treasury stock at cost, 22,850 and 15,766 shares held as of June 30, 2015 and September 30, 2014, respectively		(1,147	)		(650	)
Members' equity		-			16,414
Retained earnings		150,076			134,968
Total Alico, Inc. equity		178,589			161,851

Noncontrolling interest		4,838			-

Total liabilities and equity	$	470,222		$	257,578

	Nine Months Ended
	June 30,
	2015			2014
	(unaudited)

Net cash provided by operating activities	$	25,895		$	14,770

Cash flows from investing activities:
Capital expenditures		(9,674	)		(11,255	)
Acquisition of citrus businesses, net of cash acquired		(283,211	)		-
Proceeds from sale of sugarcane operations		97,151			-
Proceeds for the sale of assets		9,045			928
Return on investment in Magnolia Fund		652			3,185
Other		(1	)		27
Net cash used in investing activities		(186,038	)		(7,115	)

Cash flows from financing activities:
Principal payments on term loans		(15,061	)		(3,041	)
Repayment of term loan		(34,000	)		-
Borrowings on revolving lines of credit		81,135			-
Repayments on revolving lines of credit		(80,947	)		-
Proceeds from term loans		193,500			-
Financing costs		(3,353	)		-
Treasury stock purchases		(1,029	)		(4,844	)
Dividends paid		(1,381	)		(2,744	)
Principal payments on capital lease obligation		(2	)		-
Net cash provided by (used in) financing activities		138,862			(10,629	)

Net decrease in cash and cash equivalents		(21,281	)		(2,974	)
Cash and cash equivalents at beginning of period		31,020			27,252

Cash and cash equivalents at end of period	$	9,739		$	24,278

Supplemental cash flow information:
Cash paid for interest, net of amount capitalized	$	4,892		$	1,193
Cash paid for income taxes	$	5,200		$	925

Asset acquisition
(in thousands)
	Amount
Assets:
Accounts receivable, net	$	888
Other current assets		845
Inventories, net		35,562
Property, Buildings and Equipment		240,949
Goodwill		2,246
Other assets		2,140
Total assets, net of cash acquired	$	282,630

Liabilities:
Accounts payable and accrued liabilities	$	4,205
Debt		500
Payable to seller		7,500
Total liabilities assumed	$	12,205

Assets acquired less liabilities assumed	$	270,425

Less: fair value attributable to noncontrolling interest		(4,838	)

Total purchase consideration	$	265,587


Cash proceeds from sugarcane disposition	$	97,126
Working capital line of credit		27,857
Term loans		140,604

Total purchase consideration	$	265,587

(in thousands except for per share amounts)	Three Months Ended June 30, 2015						Three Months Ended June 30, 2014
				Silver Nip						Silver Nip
		Alico		Citrus		Total		Alico		Citrus			Total

Operating revenues	$	61,007	$	7,802	$	68,809	$	28,675	$	5,200		$	33,875

Gross profit	$	18,090	$	1,725	$	19,815	$	3,739	$	854		$	4,593

Net income	$	6,727	$	1,040	$	7,767	$	1,119	$	(88	)	$	1,031

Comprehensive income	$	6,727	$	1,040	$	7,767	$	1,119	$	(88	)	$	1,031

Earnings per common share:
Basic	$	0.81	$	0.13	$	0.94	$	0.15	$	(0.01	)	$	0.14
Diluted	$	0.81	$	0.13	$	0.94	$	0.15	$	(0.01	)	$	0.14

(in thousands except for per share amounts)	Nine Months Ended June 30, 2015						Nine Months Ended June 30, 2014
				Silver Nip						Silver Nip
		Alico		Citrus		Total		Alico		Citrus		Total

Operating revenues	$	129,375	$	10,734	$	140,109	$	81,139	$	8,367	$	89,506

Gross profit	$	31,185	$	1,805	$	32,990	$	15,593	$	1,770	$	17,363

Net income	$	15,866	$	2,426	$	18,292	$	4,485	$	538	$	5,023

Comprehensive income	$	15,866	$	2,426	$	18,292	$	4,485	$	538	$	5,023

Earnings per common share:
Basic	$	1.99	$	0.30	$	2.30	$	0.61	$	0.07	$	0.69
Diluted	$	1.99	$	0.30	$	2.29	$	0.61	$	0.07	$	0.68



(in thousands)

Due within one year	$	4,643
Due between one and two years	8,225
Due between two and three years	10,825
Due between three and four years	35,925
Due between four and five years	10,975
Due beyond five years	157,320

Total future maturities	$	227,913

	Nine Months Ended June 30,
Citrus Boxes Harvested	2015		2014		Change			% Change
Early & Mid-Season		4,442		4,631		(189	)		(4.1	)%
Valencias		5,569		5,031		538			10,7	%
Fresh Fruit		460		308		152			49.4	%
		10,471		9,970		501			5.0	%

Pound Solids Produced
Early & Mid-Season		26,139		28,508		(2,369	)		(8.3	)%
Valencias		36,044		33,754		2,290			6.8	%
		62,183		62,262		(79	)		(0.1	)%

Pound Solids Per Box
Early & Mid-Season		5.88		6.16		(0.28	)		(4.5	)%
Valencias		6.47		6.71		(0.24	)		(3.6	)%
Combined		6.21		6.44		(0.23	)		(3.6	)%

~~Florida~~	~~59-0906081~~

	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased As Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs

Month of March 2015		9,907	$	51.64		9,907		10,093
Month of April 2015		10,093	$	49.27		10,093		-