CADIZ Inc. (CDZI) filed Quarterly Report for the period ended 2009-06-30.
Cadiz Inc. acquires and develops water-related land and agricultural assets. Cadiz has created a portfolio of land-holdings water resources and agricultural operations. With its subsidiary Sun World International Inc. Cadiz is one of the largest vertically integrated agricultural companies. The Company owns significant landholdings with substantial water resources. CADIZ Inc. has a market cap of $146.49 million; its shares were traded at around $11.71 with and P/S ratio of 147.67.
Highlight of Business Operations:
We have not received significant revenues from our water resource activity to date. As a result, we have historically incurred a net loss from operations. We had revenues of $19 thousand for the three months ended June 30, 2009, and $16 thousand for the three months ended June 30, 2008. We incurred a net loss of $4.4 million in the three months ended June 30, 2009, compared with a $3.7 million net loss during the three months ended June 30, 2008. The higher 2009 loss was primarily due to higher stock based compensation related to shares issued under the 2007 Management Equity Incentive Plan and a stock based incentive fee earned for certain legal and advisory services upon completion of milestones associated with the Cadiz Project.
Compensation costs from stock and option awards for the three months ended June 30, 2009, were $990 thousand, compared with $839 thousand for the three months ended June 30, 2008. The expense reflects the vesting schedule of 2007 Management Equity Incentive Plan stock awards that became effective in July 2007. Of these amounts, $289 thousand in 2009 and $727 thousand in 2008 relate to Milestone-Based Deferred Stock, none of which was ultimately issued. Shares and options issued under the Plans vest over varying periods from the date of issue to January 2011. See Notes to the Consolidated Financial Statements: Note 5 – Stock Based Compensation Plans and Warrants.
We had revenues of $48 thousand for the six months ended June 30, 2009 and $33 thousand for the six months ended June 30, 2008. We incurred a net loss of $7.8 million in the six months ended June 30, 2009, compared with an $8.7 million net loss during the six months ended June 30, 2008. The higher loss in the 2008 period primarily related to higher non-cash expenses related to stock and option awards and expenses related to the Company s lawsuit against the Metropolitan Water District of Southern California that was settled in the first quarter of 2009.
Compensation costs from stock and option awards for the six months ended June 30, 2009, were $1.4 million, compared with $2.5 million for the six months ended June 30, 2008. The expense reflects the vesting schedule of 2007 Management Equity Incentive Plan stock awards that became effective in July 2007. Of these amounts, $579 thousand in 2009 and $1.8 million in 2008 relate to Milestone Based Deferred Stock, none of which was ultimately issued. Shares and options issued under the Plans vest over varying periods from the date of issue to January 2011. See Notes to the Consolidated Financial Statements: Note 5 – Stock Based Compensation Plans and Warrants.
A private placement which we completed in November 30, 2004, included the issuance of warrants to purchase shares of our common stock at an exercise price of $15.00 per share. During 2006, holders of 70,000 of the warrants exercised their warrants, resulting in our issuance of 70,000 shares of common stock with net proceeds of $1,050,000. In January 2007, we exercised our right to terminate all unexercised warrants on March 2, 2007, subject to a 30 days notice period. In response, holders of all 335,440 warrants then outstanding exercised their warrants during February 2007. As a result, we issued 335,440 shares of our common stock and received net proceeds of $5,031,000. Following these exercises, no warrants from this 2004 private placement remain outstanding.
We completed a private placement in November and December of 2008, an issuance of 165,000 Units at the price of $31.50 per unit for proceeds of $5,197,500. Each Unit consists of three (3) shares of our common stock and two (2) common stock purchase warrants. The first warrant entitles the holder to purchase one (1) share of common stock at an exercise price of $12.50 per share. This warrant has a term of one year, but is callable by us commencing six months following completion of the offering if the closing market price of our common stock exceeds $18.75 for 10 consecutive trading days. The second warrant entitles the holder to purchase one (1) share of common stock at an exercise price of $12.50 per share. This warrant has a term of three years and is not callable by us.
CDZI is in the portfolios of Jean-Marie Eveillard of Arnhold & S. Bleichroeder Advisers, LLC.
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