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BBX Capital Corporation Reports Financial Results

For the Second Quarter, 2019

FORT LAUDERDALE, Florida – August 7,  2019 -- BBX Capital Corporation (NYSE: BBX, OTCQX: BBXTB) (“BBX Capital” or the “Company”) reported today its financial results for the quarter ended June 30, 2019.

Selected highlights of BBX Capital’s consolidated financial results include:



Second Quarter 2019 Compared to Second Quarter 2018:

·

Total consolidated revenues of $251.3 million vs. $243.2 million

·

Net (loss) income attributable to shareholders of ($11.6 million) vs. $6.5 million.   Results for the second quarter of 2019 reflect a charge of $39.1 million as a result of Bluegreen’s settlement agreement with Bass Pro in June 2019

·

Diluted (loss) earnings per share of ($0.12) vs. $0.07 

·

Free cash flow of $0.3 million vs. $2.3 million (1)

·

Adjusted EBITDA of $33.1 million vs. $25.4 million (2)

(1)

See the supplemental tables included in this release for a reconciliation of BBX Capital’s cash flow from operating activities to free cash flow.  Free cash flow is defined as cash provided by operating activities less capital expenditures for property and equipment.

(2)

See the supplemental tables included in this release for a reconciliation of BBX Capital’s net income to adjusted EBITDA.



Balance Sheet as of June 30, 2019 Compared to December 31, 2018

·

Total consolidated assets of $1.8 billion vs. $1.7 billion

·

Total shareholders' equity of $539.4 million vs. $549.6 million

·

Fully diluted book value per share of $5.51 vs. $5.70 (1) 

(1)

Fully diluted book value per share is stockholders’ equity divided by the number of Class A and Class B common shares outstanding plus unvested restricted stock awards as of period end 



“BBX Capital’s results reflect a $39.1 million charge relating to the Bluegreen Vacations and Bass Pro settlement during the second quarter of 2019.  We are pleased that Bluegreen and Bass Pro were able to resolve their differences,  amend and expand their existing marketing agreement, and resume building on their very successful 19-year partnership.  Moreover, we look forward to Bluegreen’s planned expansion of its retail marketing operations throughout additional Bass Pro and Cabela’s retail store locations which see an approximate 200 million visitors annually,” commented Alan B. Levan, Chairman and Chief Executive Officer of BBX Capital Corporation.  “While the second quarter of 2019 was a challenging period for Bluegreen Vacations our other three segments performed well.   Details are summarized below.

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“As we have stated each quarter, since many of BBX Capital’s assets do not generate income on a regular or predictable basis, our objective continues to be long term growth as measured by increases in book value and intrinsic value over time.  Our goal remains to streamline our business verticals so that our business model can be more easily analyzed and followed by the markets.  To this end, we are continuing to review and evaluate the performance of our investments and consider transactions involving the sale or a spin-off of assets, investments or subsidiaries,” Levan concluded.

---------------

For more complete and detailed information regarding BBX Capital and its financial results, business, operations, investments and risks, please see BBX Capital’s Annual Report on Form 10-K for the year ended December 31, 2018 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, which will be available on the SEC's website, https://www.sec.gov, and on BBX Capital’s website, www.BBXCapital.com, upon filing with the SEC.

Non-GAAP Financial Measures: The Company refers to certain non-GAAP financial measures in this press release, including EBITDA, Adjusted EBITDA, System-wide Sales of VOIs, and Free Cash Flow.  Please see the supplemental tables for how these terms are defined and for reconciliations of such measures to the most comparable GAAP financial measures.

***

The following selected information relates to the operating activities of Bluegreen Vacations,  BBX Capital Real Estate,  Renin, and IT’SUGAR. 

Bluegreen Vacations -  Selected Financial Data 



Selected highlights of Bluegreen Vacations’ financial results include:



Second Quarter 2019 Compared to Second Quarter 2018:

·

Sales of Vacation Ownership Interests (“VOIs”) of $68.3 million vs. $68.6 million

·

System-wide sales of VOIs of $163.6 million vs. $172.0 million (1)

·

Other fee-based services revenue of  $30.7 million vs. $30.4 million

·

(Loss) income before income taxes of ($10.0 million) vs. $39.4 million

·

Adjusted EBITDA of $28.7 million vs. $41.9 million (2)

·

Free cash flow was negative by  $6.3 million vs. free cash flow of $0.1 million  (3)

(1)

See the supplemental tables included in this release  for a reconciliation of Bluegreen’s Sales of VOIs to System-wide sales of VOIs.

(2)

See the supplemental tables included in this release  for a reconciliation of Bluegreen’s net income to Adjusted EBITDA.

(3)

See the supplemental tables included in this release for a reconciliation of Bluegreen’s cash flow from operating activities to free cash flow.



In addition to BBX Capital’s Annual Report on Form 10-K for the year ended December 31, 2018,  more complete and detailed information regarding Bluegreen Vacations and its financial results, business, operations, and risks can be found in Bluegreen Vacations Annual Report on Form 10-K for the year ended December 31, 2018 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, 

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which is currently or will be available to view on the SEC's website, https://www.sec.gov, and on Bluegreen Vacations website, www.BluegreenVacations.com.     



BBX Capital Real Estate -  Selected Financial Data

Selected highlights of BBX Capital Real Estate’s (“BBXRE”) financial results include:



Second Quarter 2019 Compared to Second Quarter 2018:

·

Revenues of $10.8 million vs.  $5.0 million

·

Net gains on sales of real estate assets of $9.7 million vs. $0.7 million

·

Equity in net earnings (losses) of unconsolidated real estate joint ventures of $8.8 million vs. ($0.5 million)

·

Income before income taxes of $19.1 million vs. $1.6 million



BBXRE’s results for the quarter ended June 30, 2019 as compared to the same 2018 period reflect a net increase in sale activity in BBXRE’s portfolio in 2019, including its sale of RoboVault,  a self-storage facility located in Fort Lauderdale, Florida, and its sale of the remaining land parcels located at PGA Station in Palm Beach Gardens, Florida.  In addition, the Altis at Lakeline joint venture completed the sale of its multifamily apartment community located in Cedar Park, Texas, and the PGA Design Center joint venture sold its remaining commercial buildings located in Palm Beach Gardens, Florida.



Renin - Selected Financial Data



Selected highlights of Renin’s financial results include:



Second Quarter 2019 Compared to Second Quarter 2018:

·

Trade sales of $15.3 million vs. $16.9 million

·

Gross margin of $2.5 million vs. $2.9 million

·

Gross margin percentage of 15.97% vs. 17.12%

·

Income before income taxes of $15,000 vs. $42,000

·

Adjusted EBITDA of $0.5 million vs $0.7 million (1) 

(1)

See the supplemental tables included in this release for a reconciliation of Renin’s net income to Adjusted EBITDA.



Renin’s operating results for the quarter ended June 30, 2019 as compared to the same 2018 period reflect a decrease in trade sales and gross margin primarily due to lower sales volume from Renin’s retail channel customers resulting from a barn door promotion in 2018 that was not repeated during 2019, partially offset by a decrease in selling, general, and administrative expenses due to a reduction in headcount. 



IT’SUGAR- Selected Financial Data

Selected highlights of IT’SUGAR’s financial results include:

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Second Quarter 2019 Compared to Second Quarter 2018:

·

Trade sales of $21.5 million vs. $19.6 million

·

Gross margin of $9.1 million vs. $8.4 million

·

Gross margin percentage of 42.57% vs. 42.80%

·

Income (loss) before income taxes of $143,000 vs. ($104,000)

·

Adjusted EBITDA of $1.3 million vs $1.0 million (1)

(1)

See the supplemental tables included in this release for a reconciliation of IT’SUGAR’s net income to Adjusted EBITDA.



IT'SUGAR's operating results for the quarter ended June 30, 2019 as compared to the same 2018 period reflect a net increase in trade sales and gross margin primarily due to the opening of new locations during the second half of 2018 and the first six months of 2019, including the FAO Schweetz location in New York City and the Grand Bazaar location in Las Vegas, partially offset by  a net increase in selling, general, and administrative expenses primarily due to the hiring of certain executives during the second half of 2018 and costs associated with the new locations described above. 



During the fourth quarter of 2019,  IT’SUGAR anticipates opening a 21,000 square foot, three-story flagship location at American Dream Meadowlands, a three million square foot shopping and entertainment complex in New Jersey.  



Other Investments



The Company also has other investments in various operating businesses, including restaurant locations in Florida and companies in the confectionery industry.  The businesses generated aggregate losses before income taxes of $4.1 million and $4.9 million during the three months ended June 30, 2019 and 2018,  respectively.  Included in the $4.1 million of aggregate losses for the three months ended June 30, 2019 was $2.1 million of property and equipment impairment losses associated with three MOD Pizza locations that are performing below expectations.  Although the Company expects to continue to incur losses from these businesses during 2019, the operating results for these businesses for the quarter ended June 30, 2019 as compared to the 2018 period reflect the Company’s earlier efforts during 2018 to reduce the size of certain of its businesses in the confectionery industry, including the closure of manufacturing facilities and a  reduction in personnel and infrastructure. 

---



About BBX Capital Corporation: BBX Capital Corporation (NYSE: BBX) (OTCQX: BBXTB) is a Florida-based diversified holding company whose principal investments include Bluegreen Vacations Corporation (NYSE: BXG), BBX Capital Real Estate, Renin Holdings, and IT’SUGAR.   For additional information, please visit www.BBXCapital.com.

About Bluegreen Vacations Corporation: Bluegreen Vacations Corporation (NYSE: BXG) is a leading vacation ownership company that markets and sells vacation ownership interests (VOIs) and

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manages resorts in top leisure and urban destinations.  The Bluegreen Vacation Club is a flexible, points-based, deeded vacation ownership plan with approximately 217,000 owners, 69 Club and Club Associate Resorts and access to more than 11,300 other hotels and resorts through partnerships and exchange networks as of June 30, 2019.  Bluegreen Vacations also offers a portfolio of comprehensive, fee-based resort management, financial, and sales and marketing services, to or on behalf of third parties.  Bluegreen is approximately 90% owned by BBX Capital Corporation (NYSE: BBX) (OTCQX: BBXTB), a diversified holding company.  For further information, visit www.BluegreenVacations.com.

BBX Capital Corporation Contact Info:

Investor Relations: Leo Hinkley, Managing Director, Investor Relations Officer

954-940-5300,  Email: LHinkley@BBXCapital.com



Media Relations Contacts: Kip Hunter Marketing, 954-765-1329, Nicole Lewis / Shannon O’Malley Email: nicole@kiphuntermarketing.com,  shannon@kiphuntermarketing.com



###

This press release contains forward-looking statements based largely on current expectations of BBX Capital or its subsidiaries that involve a number of risks and uncertainties.  All opinions, forecasts, projections, future plans or other statements, other than statements of historical fact, are forward-looking statements.  Forward-looking statements may be identified by the use of words or phrases such as “plans,” “believes,” “will,” “expects,” “anticipates,” “intends,” “estimates,” “our view,” “we see,” “would” and words and phrases of similar import.  The forward-looking statements in this press release are also forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).  We can give no assurance that such expectations will prove to have been correct. Actual results, performance, or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements contained herein.  Forward-looking statements are subject to a number of risks and uncertainties that are subject to change based on factors which are, in many instances, beyond our control and the reader should not place undue reliance on any forward-looking statement, which speaks only as of the date made.  This press release also contains information regarding the past performance of the Company, its subsidiaries and their respective investments and operations, and the reader should note that prior or current performance is not a guarantee or indication of future performance.  Future results could differ materially as a result of a variety of risks and uncertainties. Some factors which may affect the accuracy of the forward-looking statements apply generally to the industries in which the Company operates, including the resort development and vacation ownership industries in which Bluegreen operates, the development, operation, management and investment in residential and commercial real estate, the home improvement industry in which Renin operates, and the sugar and confectionery industry in which IT’SUGAR operates,  as well as the pizza franchise and fast-casual restaurant industry in which the Company is a franchisee of  MOD Pizza restaurants.   Risks and uncertainties include, without limitation, the risks and uncertainties affecting BBX Capital and its subsidiaries, and their respective results, operations, markets, products, services and business strategies, including risks associated with the ability to successfully implement currently anticipated plans and generate earnings, long term growth, and increased value; the risk that BBX Capital’s efforts to

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streamline its businesses and reduce losses may not be successful or achieve the anticipated or desired benefits; the performance of entities of which BBX Capital has acquired or in which it has made investments may not be profitable or perform as anticipated; the risk that BBX Capital is dependent upon dividends from its subsidiaries, principally Bluegreen, to fund its operations and that its subsidiaries may not be in a position to pay dividends at current levels, if at all, dividend payments may be subject to certain restrictions, including restrictions contained in debt instruments, and may be subject to declaration by such subsidiary’s board of directors or managers; the risks relating to acquisitions, including acquisitions in diverse activities, including the risk that they will not perform as expected and will adversely impact the Company’s results; risks relating to the monetization of BBX Capital’s legacy assets; and risks related to litigation and other legal proceedings involving BBX Capital and its subsidiaries.  The Company’s investment in Bluegreen Vacations Corporation exposes the Company to risks of Bluegreen’s business including risks relating to its ability to increase VOI sales and profitability and risks inherent in the vacation ownership industry,  risks relating to its operations, its relationships with its strategic partners and its ability to successfully grow new marketing partnerships and alliances, risks that Bluegreen’s marketing alliances will not contribute to growth or be profitable, risks that the expansion of the Bass Pro/Cabela’s marketing channels will not be successful or occur as anticipated; as well as other risks relating to the ownership of Bluegreen’s common stock, including those described in Bluegreen’s Annual and Quarterly Reports filed with the SEC.  In addition, with respect to BBX Capital Real Estate, Renin, IT’SUGAR, and its other investments in operating businesses,  the risks and uncertainties include risks relating to the real estate market and real estate development, the risk that joint venture partners may not fulfill their obligations and the projects may not be developed as anticipated or be profitable, and the risk that contractual commitments may not be completed on the terms provided or at all; risks relating to acquisition and performance of operating businesses, including integration risks, risks regarding achieving profitability, foreign currency transaction risk, goodwill and other intangible impairment risks, risks relating to restructurings and restated charges, and the risk that assets may be disposed of at a loss; risks related to the Company’s MOD Pizza franchise activities, including that stores may not be opened when or in the number expected and that the stores once opened may not be profitable or otherwise perform as expected.  Reference is also made to the other risks and uncertainties described in BBX Capital’s Annual Report on Form 10-K for the year ended December 31, 2018 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, which will be available on the SEC's website, https://www.sec.gov, and on BBX Capital’s website, www.BBXCapital.com, upon filing with the SEC.  The Company cautions that the foregoing factors are not exclusive, and that the reader should not place undue reliance on any forward-looking statement, which speaks only as of the date made.

###









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The following supplemental table represents BBX Capital’s Consolidating Statement of Operations (unaudited) for the three months ended June  30, 2019 (in thousands):



 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

Bluegreen

 

BBX Capital Real Estate

 

Renin

 

IT'SUGAR

 

Other

 

Reconciling Items and Eliminations

 

Segment Total

Sales of VOIs

$

68,302 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

68,302 

Fee-based sales commissions

 

55,343 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

55,343 

Other fee-based services

 

30,703 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

30,703 

Cost reimbursements

 

17,358 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

17,358 

Trade sales

 

                 -

 

                 -

 

15,339 

 

21,454 

 

8,274 

 

(6)

 

45,061 

Sales of real estate inventory

 

                 -

 

424 

 

                 -

 

                 -

 

                 -

 

                    -

 

424 

Interest income

 

21,875 

 

263 

 

                 -

 

                 -

 

46 

 

(666)

 

21,518 

Net gains on sales of real estate assets

 

                 -

 

9,664 

 

                 -

 

                 -

 

                 -

 

                    -

 

9,664 

Other revenue

 

1,993 

 

449 

 

152 

 

16 

 

497 

 

(147)

 

2,960 

Total revenues

 

195,574 

 

10,800 

 

15,491 

 

21,470 

 

8,817 

 

(819)

 

251,333 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of VOIs sold

 

10,572 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

10,572 

Cost of other fee-based services

 

19,924 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

19,924 

Cost reimbursements

 

17,358 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

17,358 

Cost of trade sales

 

                 -

 

                 -

 

12,889 

 

12,320 

 

5,625 

 

(6)

 

30,828 

Cost of real estate inventory sold

 

                 -

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

                 -

Interest expense

 

10,061 

 

                 -

 

116 

 

35 

 

21 

 

1,428 

 

11,661 

Recoveries from loan losses, net

 

                 -

 

(1,424)

 

                 -

 

                 -

 

                 -

 

                    -

 

(1,424)

Impairment losses

 

                 -

 

                 -

 

                 -

 

                 -

 

2,138 

 

                    -

 

2,138 

Selling, general and administrative expenses

147,668 

 

1,879 

 

2,442 

 

8,972 

 

5,120 

 

11,887 

 

177,968 

Total costs and expenses

 

205,583 

 

455 

 

15,447 

 

21,327 

 

12,904 

 

13,309 

 

269,025 

Equity in net earnings of unconsolidated real estate joint ventures

 

                 -

 

8,759 

 

                 -

 

                 -

 

                 -

 

                    -

 

8,759 

Foreign exchange loss

 

                 -

 

                 -

 

(29)

 

                 -

 

                 -

 

                    -

 

(29)

(Loss) income before income taxes

 

(10,009)

 

19,104 

 

15 

 

143 

 

(4,087)

 

(14,128)

 

(8,962)



 

 

 

 

 

 

 

 

 

 

 

 

 

 



The following supplemental table represents BBX Capital’s Consolidating Statement of Operations (unaudited) for the three months ended June  30, 2018 (in thousands):



 

Bluegreen

 

BBX Capital Real Estate

 

Renin

 

IT'SUGAR

 

Other

 

Reconciling Items and Eliminations

 

Segment Total

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of VOIs

$

68,573 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

68,573 

Fee-based sales commissions

 

60,086 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

60,086 

Other fee-based services

 

30,391 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

30,391 

Cost reimbursements

 

14,059 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

14,059 

Trade sales

 

                 -

 

                 -

 

16,890 

 

19,623 

 

7,400 

 

(5)

 

43,908 

Sales of real estate inventory

 

                 -

 

3,250 

 

                 -

 

                 -

 

                 -

 

                     -

 

3,250 

Interest income

 

21,118 

 

301 

 

                 -

 

                 -

 

64 

 

(819)

 

20,664 

Net gains on sales of real estate assets

 

                 -

 

733 

 

                 -

 

                 -

 

                 -

 

                     -

 

733 

Other revenue

 

710 

 

710 

 

                 -

 

17 

 

311 

 

(186)

 

1,562 

Total revenues

 

194,937 

 

4,994 

 

16,890 

 

19,640 

 

7,775 

 

(1,010)

 

243,226 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of VOIs sold

 

6,789 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

6,789 

Cost of other fee-based services

 

16,634 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

16,634 

Cost reimbursements

 

14,059 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

14,059 

Cost of trade sales

 

                 -

 

                 -

 

13,998 

 

11,224 

 

5,954 

 

(5)

 

31,171 

Cost of real estate inventory sold

 

                 -

 

2,381 

 

                 -

 

                 -

 

                 -

 

                     -

 

2,381 

Interest expense

 

8,495 

 

                 -

 

174 

 

                 -

 

99 

 

1,635 

 

10,403 

Recoveries from loan losses, net

 

                 -

 

(1,999)

 

                 -

 

                 -

 

                 -

 

                     -

 

(1,999)

Impairment losses

 

                 -

 

122 

 

                 -

 

                 -

 

                 -

 

                     -

 

122 

Selling, general and administrative expenses

109,580 

 

2,377 

 

2,639 

 

8,520 

 

6,593 

 

12,338 

 

142,047 

Total costs and expenses

 

155,557 

 

2,881 

 

16,811 

 

19,744 

 

12,646 

 

13,968 

 

221,607 

Equity in net losses of unconsolidated real estate joint ventures

 

                 -

 

(488)

 

                 -

 

                 -

 

                 -

 

                     -

 

(488)

Foreign exchange loss

 

                 -

 

                 -

 

(37)

 

                 -

 

                 -

 

                     -

 

(37)

Income (loss) before income taxes

$

39,380 

 

1,625 

 

42 

 

(104)

 

(4,871)

 

(14,978)

 

21,094 



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The following supplemental table represents BBX Capital’s Consolidating Statement of Operations (unaudited) for the six months ended June  30, 2019 (in thousands):



 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

Bluegreen

 

BBX Capital Real Estate

 

Renin

 

IT'SUGAR

 

Other

 

Reconciling Items and Eliminations

 

Segment Total

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of VOIs

$

120,033 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

120,033 

Fee-based sales commissions

 

100,555 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

100,555 

Other fee-based services

 

60,271 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

60,271 

Cost reimbursements

 

37,594 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

37,594 

Trade sales

 

                 -

 

                 -

 

34,682 

 

38,669 

 

17,709 

 

(15)

 

91,045 

Sales of real estate inventory

 

                 -

 

4,660 

 

                 -

 

                 -

 

                 -

 

                    -

 

4,660 

Interest income

 

43,883 

 

465 

 

                 -

 

                 -

 

85 

 

(1,500)

 

42,933 

Net gains on sales of real estate assets

 

                 -

 

10,996 

 

                 -

 

                 -

 

                 -

 

                    -

 

10,996 

Other revenue

 

2,082 

 

1,295 

 

152 

 

226 

 

967 

 

(419)

 

4,303 

Total revenues

 

364,418 

 

17,416 

 

34,834 

 

38,895 

 

18,761 

 

(1,934)

 

472,390 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of VOIs sold

 

14,420 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

14,420 

Cost of other fee-based services

 

42,792 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

42,792 

Cost reimbursements

 

37,594 

 

                 -

 

                 -

 

                 -

 

                 -

 

                    -

 

37,594 

Cost of trade sales

 

                 -

 

                 -

 

28,006 

 

23,540 

 

11,587 

 

(15)

 

63,118 

Cost of real estate inventory sold

 

                 -

 

2,643 

 

                 -

 

                 -

 

                 -

 

                    -

 

2,643 

Interest expense

 

19,567 

 

                 -

 

256 

 

57 

 

43 

 

2,886 

 

22,809 

Recoveries from loan losses, net

 

                 -

 

(2,385)

 

                 -

 

                 -

 

                 -

 

                    -

 

(2,385)

Impairment losses

 

                 -

 

                 -

 

                 -

 

                 -

 

2,756 

 

                    -

 

2,756 

Selling, general and administrative expenses

237,882 

 

4,373 

 

5,477 

 

17,078 

 

11,161 

 

23,990 

 

299,961 

Total costs and expenses

 

352,255 

 

4,631 

 

33,739 

 

40,675 

 

25,547 

 

26,861 

 

483,708 

Equity in net earnings of unconsolidated real estate joint ventures

 

                 -

 

8,742 

 

                 -

 

                 -

 

                 -

 

                    -

 

8,742 

Foreign exchange loss

 

                 -

 

                 -

 

(24)

 

                 -

 

                 -

 

                    -

 

(24)

Income (loss) before income taxes

$

12,163 

 

21,527 

 

1,071 

 

(1,780)

 

(6,786)

 

(28,795)

 

(2,600)



The following supplemental table represents BBX Capital’s Consolidating Statement of Operations (unaudited) for the six months ended June  30, 2018 (in thousands):



 

Bluegreen

 

BBX Capital Real Estate

 

Renin

 

IT'SUGAR

 

Other

 

Reconciling Items and Eliminations

 

Segment Total

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of VOIs

$

124,714 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

124,714 

Fee-based sales commissions

 

105,940 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

105,940 

Other fee-based services

 

58,415 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

58,415 

Cost reimbursements

 

30,260 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

30,260 

Trade sales

 

                 -

 

                 -

 

31,875 

 

36,304 

 

14,139 

 

(7)

 

82,311 

Sales of real estate inventory

 

                 -

 

9,659 

 

                 -

 

                 -

 

                 -

 

                     -

 

9,659 

Interest income

 

42,240 

 

1,834 

 

                 -

 

 

95 

 

(1,589)

 

42,581 

Net gains on sales of real estate assets

 

                 -

 

4,802 

 

                 -

 

                 -

 

                 -

 

                     -

 

4,802 

Other revenue

 

891 

 

1,449 

 

                 -

 

35 

 

615 

 

(379)

 

2,611 

Total revenues

 

362,460 

 

17,744 

 

31,875 

 

36,340 

 

14,849 

 

(1,975)

 

461,293 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of VOIs sold

 

8,601 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

8,601 

Cost of other fee-based services

 

34,045 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

34,045 

Cost reimbursements

 

30,260 

 

                 -

 

                 -

 

                 -

 

                 -

 

                     -

 

30,260 

Cost of trade sales

 

                 -

 

                 -

 

26,148 

 

21,784 

 

11,166 

 

(7)

 

59,091 

Cost of real estate inventory sold

 

                 -

 

6,628 

 

                 -

 

                 -

 

                 -

 

                     -

 

6,628 

Interest expense

 

16,262 

 

                 -

 

340 

 

                 -

 

188 

 

2,812 

 

19,602 

Recoveries from loan losses, net

 

                 -

 

(6,814)

 

                 -

 

                 -

 

                 -

 

                     -

 

(6,814)

Impairment losses

 

                 -

 

169 

 

                 -

 

                 -

 

187 

 

                     -

 

356 

Selling, general and administrative expenses

203,129 

 

4,868 

 

5,390 

 

16,597 

 

11,670 

 

25,281 

 

266,935 

Total costs and expenses

 

292,297 

 

4,851 

 

31,878 

 

38,381 

 

23,211 

 

28,086 

 

418,704 

Equity in net earnings of unconsolidated real estate joint ventures

 

                 -

 

792 

 

                 -

 

                 -

 

                 -

 

                     -

 

792 

Foreign exchange gain

 

                 -

 

                 -

 

15 

 

                 -

 

                 -

 

                     -

 

15 

Income (loss) before income taxes

$

70,163 

 

13,685 

 

12 

 

(2,041)

 

(8,362)

 

(30,061)

 

43,396 



8

 


 

The following supplemental table represents Bluegreen’s System-wide sales of VOIs  (1) for the three and six months ended June 30, 2019 and 2018 as well as a reconciliation of Bluegreen’s Sales of VOIs to its System-wide sales of VOIs (unaudited) (in thousands):



 

 

 

 

 

 

 

 



 

For the Three Months Ended

 

For the Six Months Ended



 

June 30,

 

June 30,



 

2019

 

2018

 

2019

 

2018

Sales of VOIs

$

68,302 

 

68,573 

 

120,033 

 

124,714 

Provision for loan losses

 

11,919 

 

13,454 

 

23,072 

 

21,473 

Gross Sales of VOI's

 

80,221 

 

82,027 

 

143,105 

 

146,187 

Plus: Fee-based sales

 

83,352 

 

89,934 

 

150,146 

 

158,618 

System-wide sales of VOIs, net

$

163,573 

 

171,961 

 

293,251 

 

304,805 



 

 

 

 

 

 

 

 





(1)    System-wide Sales of VOIs is a non-GAAP measure and represents all sales of VOIs, whether owned by Bluegreen or a third party immediately prior to the sale. Sales of VOIs owned by third parties are transacted as sales of VOIs in Bluegreen’s Vacation Club through the same selling and marketing process it uses to sell its VOI inventory. Bluegreen considers system-wide sales of VOIs to be an important operating measure because it reflects all sales of VOIs by its sales and marketing operations without regard to whether Bluegreen or a third party owned such VOI inventory at the time of sale. System-wide sales of VOIs should not be considered as an alternative to sales of VOIs or any other measure of financial performance derived in accordance with GAAP or to any other method of analyzing results as reported under GAAP.



















































9

 


 

The following supplemental table represents BBX Capital’s free cash flow  (1) for the three and six months ended June 30, 2019 and 2018 as well as a reconciliation of cash flow from operating activities to free cash flow (unaudited) (in thousands):  





 

 

For the Three Months Ended

 

For the Six Months Ended



 

 

June 30,

 

June 30,



 

 

2019

 

2018

 

2019

 

2018

Cash flow from operating activities

$

8,860 

 

14,311 

 

2,294 

 

12,629 



Capital expenditures for property and equipment

 

(8,551)

 

(11,998)

 

(18,244)

 

(20,073)

Free cash flow

$

309 

 

2,313 

 

(15,950)

 

(7,444)







The following supplemental table represents Bluegreen’s free cash flow (1) for the three and six months ended June 30, 2019 and 2018 as well as a reconciliation of Bluegreen’s cash flows from operating activities to its free cash flow (unaudited) (in thousands): 





 

 

For the Three Months Ended

 

For the Six Months Ended



 

 

June 30,

 

June 30,



 

 

2019

 

2018

 

2019

 

2018

Cash flow from operating activities

$

670 

 

9,752 

 

11,612 

 

23,215 



Capital expenditures for property and equipment

 

(7,009)

 

(9,643)

 

(14,516)

 

(15,105)

Free cash flow

$

(6,339)

 

109 

 

(2,904)

 

8,110 



 

 

 

 

 

 

 

 

 





(1)    Free cash flow is a non-GAAP measure and is defined as cash provided by operating activities less capital expenditures for property and equipment. The Company and Bluegreen focus on the generation of free cash flow. The Company considers free cash flow to be a useful supplemental measure of the Company’s and Bluegreen’s ability to generate cash flow from operations and is a supplemental measure of liquidity.  Free cash flow should not be considered as an alternative to cash flow from operating activities as a measure of its liquidity. The Company's computation of free cash flow may differ from the methodology utilized by other companies. Investors are cautioned that the item excluded from free cash flow is a  significant component in understanding and assessing the Company’s financial performance.





10

 


 

The following supplemental table presents Bluegreen’s EBITDA and Adjusted EBITDA,  (1) defined below, for the three and six months ended June  30, 2019 and 2018, as well as a reconciliation of Bluegreen’s net (loss) income to its EBITDA and Adjusted EBITDA (unaudited) (in thousands):    





 

 

 

 

 

 

 

 

 



 

 

For the Three Months Ended

 

For the Six Months Ended



 

 

June 30,

 

June 30,



 

 

2019

 

2018

 

2019

 

2018

Net (loss) income

$

(6,052)

 

30,027 

 

10,817 

 

53,609 



(Benefit) provision for income taxes

 

(3,957)

 

9,353 

 

1,346 

 

16,554 



(Loss) income before income taxes

(10,009)

 

39,380 

 

12,163 

 

70,163 



Add/(Less):

 

 

 

 

 

 

 

 



Interest income (other than interest earned on VOI notes receivable)

 

(1,792)

 

(1,381)

 

(3,638)

 

(2,816)



Interest expense

 

4,991 

 

3,873 

 

9,235 

 

6,930 



Franchise taxes

 

25 

 

43 

 

60 

 

124 



Depreciation and amortization

 

3,504 

 

2,989 

 

6,870 

 

5,917 

Bluegreen EBITDA

 

(3,281)

 

44,904 

 

24,690 

 

80,318 



EBITDA attributable to the noncontrolling

 

 

 

 

 

 

 

 



 interest in Bluegreen/Big Cedar Vacations

 

(5,193)

 

(3,292)

 

(6,974)

 

(5,884)



(Gain) loss on assets held-for-sale

 

(1,989)

 

11 

 

(1,980)

 

(9)



Bass Pro settlement

 

39,121 

 

                      -

 

39,121 

 

                      -



Corporate realignment costs

 

                      -

 

275 

 

                      -

 

751 

Adjusted EBITDA

$

28,658 

 

41,898 

 

54,857 

 

75,176 





(1)  Bluegreen’s EBITDA is defined as earnings or net income, before taking into account interest income (excluding interest earned on VOI notes receivable), interest expense (excluding interest expense incurred on financings related to Bluegreen’s receivable-backed notes payable), income and franchise taxes, and depreciation and amortization. For purposes of the EBITDA calculation, no adjustments were made for interest income earned on Bluegreen’s VOI notes receivable or the interest expense incurred on debt that is secured by such notes receivable because they are both considered to be part of the operations of Bluegreen’s business.

Bluegreen’s Adjusted EBITDA is defined as EBITDA adjusted for amounts attributable to noncontrolling interest in Bluegreen/Big Cedar Vacations (in which Bluegreen has a 51% equity interest) and items that the Company believes are not representative of ongoing operating results.    Accordingly, amounts paid, accrued, or incurred in connection with the Bass Pro settlement in June 2019 were excluded in the computation of Adjusted EBITDA.

The Company considers Bluegreen’s EBITDA and Adjusted EBITDA to be an indicator of Bluegreen’s operating performance, and they are used to measure Bluegreen’s ability to service debt, fund capital expenditures and expand its business. EBITDA is also used by companies, lenders, investors and others because it excludes certain items that can vary widely across different industries or among companies within the same industry. For example, interest expense can be dependent on a company’s capital structure, debt levels and credit ratings. Accordingly, the impact of interest expense on earnings can vary significantly among companies. Additionally, the tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate. As a result, effective tax rates and provision for income taxes can vary considerably among companies. EBITDA also excludes depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets. These differences can result in considerable variability in the relative costs of productive assets and the related depreciation and amortization expense among companies.

The Company considers Bluegreen’s Adjusted EBITDA to be a useful supplemental measure of Bluegreen’s operating performance that facilitates the comparability of historical financial periods.

EBITDA and Adjusted EBITDA should not be considered as an alternative to net income as an indicator of Bluegreen's financial performance or as an alternative to cash flow from operating activities as a measure of its liquidity. The Company's computation of Bluegreen’s EBITDA and Adjusted EBITDA may differ from the methodology utilized by other companies. Investors are cautioned that items excluded from EBITDA and Adjusted EBITDA are significant components in understanding and assessing Bluegreen’s financial performance.

11

 


 

The following supplemental table presents Renin’s EBITDA and Adjusted EBITDA,  (1) defined below, for the three and six months ended June  30, 2019 and 2018, as well as a reconciliation of Renin’s net (loss) income to its EBITDA and Adjusted EBITDA (unaudited) (in thousands): 





 

 

For the Three Months Ended

 

For the Six Months Ended



 

 

June 30,

 

June 30,



 

 

2019

 

2018

 

2019

 

2018

Net (loss) income from Renin

$

(3)

 

42 

$

631 

 

12 



Provision from income taxes

 

18 

 

                      -

 

440 

 

                      -

Income before income taxes

 

15 

 

42 

 

1,071 

 

12 



Add:

 

 

 

 

 

 

 

 



Interest expense

 

116 

 

174 

 

256 

 

340 



Depreciation and amortization

 

326 

 

495 

 

731 

 

993 

EBITDA

 

457 

 

711 

 

2,058 

 

1,345 



Foreign exchange loss (gain)

 

29 

 

37 

 

24 

 

(15)

Adjusted EBITDA

$

486 

 

748 

$

2,082 

 

1,330 



 

 

 

 

 

 

 

 

 







(1)  Renin’s EBITDA is defined as its earnings, or net income, before taking into account interest expense, income taxes, and depreciation and amortization, including the amortization of product displays provided to customers for marketing purposes that are presented as a reduction of trade sales under GAAP.

Renin’s Adjusted EBITDA is defined as EBITDA adjusted for foreign exchange gains and losses, as exchange rates may vary significantly among companies. 

The Company considers Renin’s EBITDA and Adjusted EBITDA to be an indicator of Renin’s operating performance, and they are used to measure Renin’s ability to service debt, fund capital expenditures and expand its business. EBITDA is also used by companies, lenders, investors and others because it excludes certain items that can vary widely across different industries or among companies within the same industry.

The Company considers Renin’s Adjusted EBITDA to be a useful supplemental measure of Renin’s operating performance that facilitates the comparability of historical financial periods.

EBITDA and Adjusted EBITDA should not be considered as an alternative to net income as an indicator of Renin’s financial performance or as an alternative to cash flow from operating activities as a measure of its liquidity. The Company’s computation of Renin’s EBITDA and Adjusted EBITDA may differ from the methodology utilized by other companies, and investors are cautioned that items excluded from EBITDA and Adjusted EBITDA are significant components in understanding and assessing Renin’s financial performance.

12

 


 

The following supplemental table presents IT’SUGAR’s EBITDA and Adjusted EBITDA, (1) defined below, for the three and six months ended June  30, 2019 and 2018, as well as a reconciliation of IT’SUGAR’s net income (loss) to its EBITDA and Adjusted EBITDA (unaudited) (in thousands): 





 

 

For the Three Months Ended

 

For the Six Months Ended



 

 

June 30,

 

June 30,



 

 

2019

 

2018

 

2019

 

2018

Net income (loss) from IT'SUGAR