SOURCE: BBX Capital Corporation

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May 13, 2014 08:00 ET

BBX Capital Corporation Reports Financial Results for the First Quarter, 2014

FORT LAUDERDALE, FL--(Marketwired - May 13, 2014) - BBX Capital Corporation ("BBX Capital" and/or the "Company") (NYSE: BBX), formerly BankAtlantic Bancorp, Inc., reported financial results for the quarter ended March 31, 2014.

BBX Capital reported net income of $1.3 million, or $0.08 per diluted share, for the quarter ended March 31, 2014, versus a net loss of ($6.5) million, or ($0.41) per diluted share, for the quarter ended March 31, 2013. 

BBX Capital's book value at March 31, 2014 was $19.03 and total BBX Capital shareholders' equity at March 31, 2014 was approximately $304.6 million.

Overview and Highlights:

BBX Capital Selected Financial Data (Consolidated)
First Quarter, 2014 Compared to First Quarter, 2013

  • Total revenues of $21.1 million vs. $6.8 million
  • Net income of $1.3 million vs. Net loss of ($6.5) million
  • Diluted earnings (loss) per share of $0.08 vs. ($0.41)
  • Book value per share was $19.03 vs. $14.83
  • Total assets were $416.9 million vs. $432.5 million
  • BB&T's preferred interest in FAR was $54.5 million vs. $164.1 million
  • Real estate owned was $141.9 million vs. $77.7 million
  • Loans receivable were $59.6 million vs. $254.8 million
  • Loans held-for-sale were $50.7 million vs. $22.3 million

BBX Capital's Chairman and CEO, Mr. Alan B. Levan, commented, "We are pleased with the results and momentum during the quarter. Since the sale of BankAtlantic in July 2012, we have been repositioning our business, monetizing our legacy portfolios, and pursuing our goal of transitioning our legacy business into a growth business by focusing on real estate opportunities and operating businesses. We invite our readers to review the BBX Capital Corporate Overview filed by the Company with the Securities and Exchange Commission on April 16, 2014, which is available to view on the BBX Capital website: www.BBXCapital.com. In that document we discussed our corporate strategy, but more importantly we discussed who we are and how we are approaching our business: 

"First, our culture is entrepreneurial. Our objective is to make portfolio investments based on the fundamentals: quality real estate, the right operating companies and partnering with good people. 

"Second, our goal is to increase value over time as opposed to focusing on quarterly or yearly earnings. Since we expect our investments to be longer term, we anticipate and are willing to accept that our earnings are likely to be uneven. While capital markets generally encourage short term goals, our objective is long term growth as measured by increases in book value per share over time."

The following provides financial and other information regarding our assets, including our BankAtlantic legacy portfolio of loans and foreclosed real estate, our investment in Bluegreen, and our real estate joint ventures and acquired operating businesses.

BBX Capital - Legacy Assets - Loans and Real Estate:

Assets transferred to BBX Capital in connection with the consummation in July 2012 of the sale of BankAtlantic to BB&T Corporation (referred to as the "BB&T Transaction"), were primarily loans receivable, real estate held-for-sale and real estate held-for-investment, as well as assets owned by BBX Capital in its BBX Capital Partners subsidiary. These assets transferred are considered our "Legacy Assets". These Legacy Assets are held by BBX Capital in CAM (Capital Asset Management) and BBX Partners, which are wholly owned subsidiaries, and in FAR (Florida Asset Resolution Group). FAR was formed in connection with the BB&T Transaction when BankAtlantic contributed to FAR certain performing and non-performing loans, tax certificates and foreclosed real estate. Upon consummation of the BB&T Transaction, BBX Capital transferred to BB&T Corporation a 95% preferred interest in the net cash flows of FAR until such time as BB&T Corporation has recovered $285 million in preference amount plus a priority return of LIBOR + 200 basis points per annum on any unpaid preference amount. At that time, BB&T Corporation's interest in FAR will terminate, and the Company will thereafter be entitled to any and all residual proceeds from FAR as its sole owner. At March 31, 2014, BB&T Corporation's preference amount had been reduced to $54.5 million.

CAM and BBX Partners Loans: The composition of CAM and BBX Partners legacy loans were (dollars in thousands):

         
   As of March 31, 2014  As of December 31, 2013


Loans held-for-investment:
 

Number
 Unpaid
Principal
Balance
 
Carrying
Amount
 

Number
 Unpaid
Principal
Balance
 
Carrying
Amount
Loans receivable:                      
Commercial non-real estate:                      
  Accruing  -  $-  $-  -  $-  $-
  Non-accruing  2   3,120   1,392  3   5,107   3,331
Commercial real estate:                      
  Accruing  1   2,140   2,140  1   2,152   2,152
  Non-accruing  4   27,005   11,454  4   27,077   11,526
Total loans held-for-investment  7   32,265   14,986  8   34,336   17,009
                       
Loans held-for-sale  -  $-  $-  -  $-  $-
                                 

CAM and BBX Partners Real Estate: The composition of CAM and BBX Partners real estate was (dollars in thousands):

       
   As of March 31, 2014  As of December 31, 2013
   
Number
 Carrying
Amount
 
Number
 Carrying
Amount
Real estate held-for-investment:              
Land  12  $71,955  13  $75,333
Rental properties  1   10,865  2   15,705
Other  1   789  1   789
Total real estate held-for-investment  14  $83,609  16  $91,827
               
Real estate held-for-sale:              
Land  11  $13,400  10  $10,307
Total real estate held-for-sale  11  $13,400  10  $10,307
                     

FAR Loans: The composition of FAR's legacy loans were (dollars in thousands):

       
   As of March 31, 2014  As of December 31, 2013


Loans held-for-investment:
 

Number
 Unpaid
Principal
Balance
 
Carrying
Amount
 

Number
 Unpaid
Principal
Balance
 
Carrying
Amount
Loans receivable:                      
Commercial non-real estate:                      
  Accruing  -  $-  $-  -  $-  $-
  Non-accruing  -   -   -  -   -   -
Commercial real estate:                      
  Accruing  8   15,737   15,737  7   15,245   15,245
  Non-accruing  7   39,538   22,052  10   52,108   34,014
Consumer                      
  Accruing  59   5,483   5,483  62   5,646   5,646
  Non-accruing  43   5,739   2,903  43   5,846   2,972
Residential:                      
  Accruing  -   -   -  -   -   -
  Non-accruing  -   -   -  2   189   53
Total loans held-for-investment  117   66,497   46,175  124   79,034   57,930
Loans held-for-sale:                      
Commercial real estate                      
  Accruing  -  $-  $-  -  $-  $-
  Non-accruing  -   -   -  -   -   -
Consumer                      
  Accruing  14   1,908   1,908  15   2,044   1,494
  Non-accruing  30   4,054   2,829  31   4,135   2,682
Residential                      
  Accruing  33   4,833   3,846  34   4,912   3,945
  Non-accruing  247   55,499   32,493  255   58,603   34,278
Small business                      
  Accruing  44   8,533   7,067  52   10,320   8,170
  Non-accruing  14   3,964   2,573  17   4,204   3,277
Total loans held-for-sale  382   78,791   50,716  404   84,218   53,846
                                 

FAR Real Estate: The composition of FAR's real estate was (dollars in thousands):

       
   As of March 31, 2014  As of December 31, 2013
   
Number
 Carrying
Amount
 
Number
 Carrying
Amount
Real estate held-for-investment:              
Land  3  $4,322  3  $4,323
Rental properties  2   20,499  1   11,186
Total real estate held-for-investment  5  $24,821  4  $15,509
               
Real estate held-for-sale:              
Land  7  $7,700  8  $7,961
Rental properties  4   6,123  3   6,168
Residential single-family  26   5,022  29   6,447
Other  24   1,199  23   3,088
Total real estate held-for-sale  61  $20,044  63  $23,664
                     

BBX Capital Real Estate Activities

Our real estate activities, including the BankAtlantic legacy loan and foreclosed real estate portfolios, fall under the umbrella of BBX Capital Real Estate, a Division of BBX Capital. As previously announced, we are liquidating some legacy real estate while holding and managing others for capital appreciation and development. We are also pursuing new real estate development opportunities, unrelated to the legacy portfolios. 

We are actively engaged in real estate development and operation activities involving real estate obtained through foreclosure and real estate purchased from third parties, including land entitlement activities, property renovations, asset management, and pursuing joint venture opportunities involving the contribution of these properties and/or cash investments in joint ventures with third party development partners.

The Company had investments in the following joint ventures as of March 31, 2014:

Kendall Commons:  In March 2013, the Company sold land to Altman Development ("Altman"), a third party real estate developer, for net proceeds of $8.0 million. Altman contributed the land to a joint venture to develop the property as a multifamily rental development of 12 three-story apartment buildings, one mixed-use building and one clubhouse totaling 321 apartment units, and the Company then invested $1.3 million of cash in the joint venture project as one of a number of investors. The development is currently under construction and scheduled to begin leasing during the third quarter of 2014. The Company is entitled to receive 13% of joint venture distributions until a 15% internal rate of return has been attained and then the Company will be entitled to receive 9.75% of any joint venture distributions thereafter.

North Flagler: In October 2013, the Company entered into a joint venture with JRG USA pursuant to which JRG USA assigned to the joint venture a contract to purchase for $10.8 million a 4.5 acre parcel overlooking the Intracoastal Waterway in West Palm Beach Florida and the Company invested $0.5 million of cash. The joint venture is seeking to expand land entitlements and is currently working to amend the current zoning designation and increase the parcel's residential height restrictions with a view to increasing the value of the parcel. The Company is entitled to receive 80% of any joint venture distributions until it recovers its capital investment and then will be entitled to receive 70% of any joint venture distributions thereafter. The entitlement process is currently estimated to be concluded in 2015. 

The Company also owns a 2.7 acre parcel located adjacent to the 4.5 acre parcel which is the subject of the contract held by the North Flagler joint venture. The 2.7 acre parcel was acquired by the Company through foreclosure and had a carrying value of $3.2 million as of March 31, 2014. We believe that the value of this parcel will increase if the density is increased by the municipality's approval of the zoning changes referenced in the preceding paragraph.

PGA Design Center Holdings, LLC: In December 2013, the Company purchased for $6.1 million a commercial property in Palm Beach Gardens, Florida, with three existing buildings consisting of 145,000 square feet of mainly furniture retail space. The property, which is located in a larger mixed use property now known as PGA Place, was substantially vacant at the date of acquisition. Subsequent to the acquisition of the property, the Company entered into a joint venture with Stiles Development which acquired a 60% interest in the joint venture for $2.9 million in cash. The Company contributed the property (excluding certain residential development entitlements having an estimated value of $1.2 million) to the joint venture in exchange for $2.9 million in cash and the remaining 40% interest in the joint venture. The Company transferred the retained residential development entitlements to adjacent parcels owned by it in PGA Place (see below for a discussion of the other parcels owned by the Company in PGA Place). The joint venture intends to seek governmental approvals to change the use of a portion of the property from retail to office and subsequently sell or lease the property.

The following development projects are currently in the planning stages and involve real estate held-for-investment included in the above CAM and BBX Partners real estate table.

Gardens at Millenia: Gardens at Millenia consists of 37 acres of land located in a commercial center of Orlando, Florida with a carrying value of $11.2 million as of March 31, 2014. This site is currently in the planning process and the final size and density of the project is subject to governmental approvals and other conditions. The proposed plans for 26 acres of this site include a 300,000 square foot retail shopping center with multiple big-box and in-line tenants as well as four outparcel retail pads. The Company is in discussions with a potential joint venture partner to develop a portion of the 26 acre parcel. Current plans for the remaining 11 acres of this site include 9 buildings of rental apartments totaling approximately 280 units, a clubhouse, lakeside pavilion, lakeside running trail, and a dog park. The Company is in discussions with a potential joint venture partner to develop the 11 acre parcel.

Hialeah Communities: Hialeah Communities consists of 114 acres of land located in Hialeah, Florida with a carrying value of $30.7 million as of March 31, 2014. This site is currently in the final stages of master planning to divide the property into three parcels and the plan remains subject to receipt of governmental approvals. The anticipated plans for the three parcels include the following:

  • An approximate 50 acre parcel is currently planned to include approximately 340 single-family homes, a clubhouse, park, and lake. The Company is in discussions with a potential joint venture partner to develop this parcel.
  • An approximate 50 acre parcel is currently planned to include approximately 400 single-family homes. The Company currently has a contract to sell this parcel to a third party developer, subject to receipt of entitlements, and due diligence by the third party.
  • Plans for the remaining 14 acre parcel include 14 multifamily buildings totaling approximately 314 rental apartment units, a clubhouse, pool and park. The Company is in discussions with a potential joint venture partner to develop this parcel.

PGA Place: The Company owns an office building and land located in PGA Place, in the city of Palm Beach Gardens, Florida, with carrying values aggregating $14.5 million as of March 31, 2014. The property held by the PGA Design Center Holdings joint venture described above is also located in PGA Place. We believe this property presents a variety of development opportunities, including the opportunity being pursued by the PGA Design Center Holdings joint venture discussed above and the following development opportunities, some of which are currently in the planning stages and remain subject to receipt of government approvals.

  • Office - This mixed use property includes a 33,000 square foot commercial leased office building that is currently 56% occupied with an attached 428 space parking garage. The Company is currently seeking governmental approvals for a 140 room limited-service suite hotel, a 5,000 square foot freestanding restaurant and a 50,000 square foot office building on vacant tracts of land adjacent to this office building. We anticipate partnering with a third party developer to develop all or a portion of these components of the project. 
  • Multi-family - Current plans for the 7-acre multifamily parcel include approximately 300 apartment units, a clubhouse and spa, and lakeside pavilion. The Company is in discussions with a potential joint venture partner to develop this parcel.

Village at Victoria Park: Village at Victoria Park consists of approximately 2 acres of vacant land located near downtown Fort Lauderdale, Florida with a carrying value of $0.9 million as of March 31, 2014. In December 2013, the Company entered into a joint venture agreement with New Urban Communities to develop the project as 30 single-family homes. The project is a 50% joint venture, with New Urban Communities serving as the developer and manager. In April 2014, the joint venture executed an acquisition, development and construction loan with a financial institution and the Company and New Urban Communities each contributed an additional $692,000 to the joint venture as a capital contribution. The joint venture purchased the vacant land from the Company for $3.6 million consisting of $1.8 million in cash (less $0.2 million in selling expenses) and a $1.6 million promissory note. The $1.6 million promissory note is secured by a junior lien on the vacant land and future improvements. The project is currently scheduled to commence construction and sales in the second quarter of 2014. Closings are projected to begin by the third quarter of 2015.

BBX Capital Partners - Investment and Acquisitions:

BBX Capital, through its BBX Capital Partners Division, is actively engaged in investments in operating companies. Our goal at BBX Capital is to diversify our platform so that a meaningful percentage of our assets and income will be derived from operating businesses. It is our objective that the investments and acquisitions sourced by BBX Capital Partners will diversify our overall company risk profile and contribute more consistent cash flows and earnings over time.

The following is a summary of the Company's operating businesses:

Bluegreen Corporation: On April 2, 2013, BBX Capital acquired a 46% interest in Woodbridge Holdings, LLC ("Woodbridge"). BFC Financial Corporation ("BFC"), BBX Capital's Parent company, owns the remaining 54% of Woodbridge. Woodbridge's principal asset is its 100% ownership of Bluegreen Corporation ("Bluegreen").

During the three months ended March 31, 2014, net income attributable to Woodbridge was $13.5 million, of which $14.2 million related to the operations of Bluegreen. BBX Capital recognized 46% of the net income attributable to Woodbridge, or $6.2 million, for the three months ended March 31, 2014. 

In 2013 and the first quarter of 2014, Bluegreen paid cash dividends of $47.0 million and $14.5 million, respectively, to Woodbridge. Woodbridge paid cash dividends of $44.3 million and $13.9 million, respectively, to its members during 2013 and April 1, 2014, which were distributed pro rata to BBX Capital and BFC based on their percentage ownership interests in Woodbridge, BBX Capital (46%) and BFC (54%). 

Bluegreen is a sales, marketing and management company focused on the vacation ownership industry. Bluegreen markets, sells and manages vacation ownership interests ("VOIs") in resorts, which are generally located in popular, high-volume, "drive-to" vacation destinations, and were either developed or acquired by Bluegreen or developed and owned by others, in which case Bluegreen earns fees for providing these services. Bluegreen operates today with more than 60 owned or managed resorts, 180,000 owners of VOIs and 4,000 employees. 

Bluegreen generates revenues from the sales of VOIs in its resorts ("Legacy Business Model") and from fee-based sales and services on behalf of third parties under Bluegreen's "capital-light" business strategy. Bluegreen's capital-light business strategy consists of the following:

Fee-Based Sales and Marketing Arrangements: Under the arrangements, Bluegreen sells third party VOIs as Bluegreen Vacation Club interests through its distribution network of sales offices typically on a non-committed basis.

Just-In-Time Arrangements: Agreements with third party developers allow Bluegreen to buy VOI inventory from time to time in close proximity to the time of when Bluegreen intends to sell such VOIs.

Secondary Market Arrangements: Formal program to acquire VOI inventory from resorts' property owner associations ("POAs") and other third parties on a non-committed basis, in close proximity to the time when Bluegreen intends to sell such VOIs. Such VOIs are typically obtained by the POAs through foreclosure in connection with maintenance fee defaults, and are generally acquired by Bluegreen at a significant discount.

Other Fee-Based Services: Bluegreen also earns fees for providing management services to the Bluegreen Vacation Club and to certain POAs. 

Bluegreen Highlights for the First Quarter, 2014

  • Legacy VOI sales were $32.0 million
  • Secondary market VOI sales were $19.0 million
  • Just-in-time VOI sales were $16.8 million
  • Gross sales of VOIs were $67.8 million
  • Sale of third party VOIs - commission basis were $42.1 million
  • System-wide sales of VOIs were $109.9 million
  • Capital-Light business strategy VOI sales were $77.9 million
  • Income from continuing operations was $17.2 million
  • Adjusted EBITDA was $33.8 million
  • Income from continuing operations before income taxes was $26.3 million
  • Operating profit was $25.8 million
  • Bluegreen dividends to Woodbridge were $14.5 million

Please see the supplemental tables included in this release for detailed information on System-wide sales of VOIs and a reconciliation of Income from Continuing Operations to Adjusted EBITDA.

For more detailed information regarding Bluegreen and its business, operations and risks, see BFC's financial results press release for the quarter ended March 31, 2014, BFC's Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, and BFC's Annual Report on Form 10-K for the year ended December 31, 2013, which is available on the SEC's website, www.sec.gov and/or BFC's website, www.BFCFinancial.com

Renin Corp.: In October 2013, Renin Holdings, LLC ("Renin"), a newly formed joint venture entity owned 81% by BBX Capital and 19% by BFC, acquired substantially all of the assets and certain liabilities of Renin Corp. Renin is a manufacturer of interior and closet doors, wall décor, associated systems and hardware and fabricated glass products through a portfolio of brand name and private label offerings including Erias, DSH, Acme, KingStar, TRUporte, Ramtrack and JJ Home Products. With facilities in Canada, the U.S. and the United Kingdom, Renin is in a position to service distribution channels including big box building and home improvement supply retailers, home centers, distributors, other building supply manufacturers, volume builders and specialty retailers throughout North America and other markets. Renin had revenues of approximately $14.1 million during the quarter ended March 31, 2014.

BBX Sweet Holdings: In December 2013, BBX Sweet Holdings acquired the Hoffman's Chocolates business and in January 2014, it acquired Williams & Bennett. BBX Sweet Holdings is pursuing other acquisitions in the candy and confections industry, and is currently in discussion with several companies throughout the United States and Canada.

Williams & Bennett: Headquartered in Boynton Beach, Florida, Williams & Bennett is a Florida based manufacturer of quality chocolate products. Williams & Bennett sells chocolate products and confections through distribution channels serving boutique retailers, big box chains, department stores, national resort properties, corporate customers, and private label brands. Since 1992, they have developed a reputation of branded chocolate drenched products including Belgian chocolate drenched Oreo Cookies, Bavarian pretzels, Nutter Butter Cookies, Marshmallows, Graham Crackers and other confectionary products. Williams & Bennett offers these chocolate creations in distinctive collectable packaging for all occasions. 

Hoffman's Chocolates: Headquartered in Lake Worth, Florida, Hoffman's Chocolates is a manufacturer of gourmet chocolates, with several retail locations throughout South Florida. Each of Hoffman's confections is hand made. Its product line includes over 70 varieties of confections, which are available via its retail stores, online distribution channels, direct shipping throughout the U.S., and at third party retail locations nationwide. In addition to Kosher O-U chocolates, Boca Bons and Good Fortune cookies, notable Hoffman's confections include the "Snoodle," Pecan Carmel "Jitterbugs," the Hoffman's Holiday Wonderland, and products such as gift baskets and chocolate covered pretzels. 

Financial data is provided in the supplemental financial tables included in this release for BBX Capital Corporation, Woodbridge Holdings, LLC and Bluegreen Corporation.

More complete and detailed information relating to BBX Capital and its financial results is available in the Company's Annual Report on Form 10-K for the year ended December 31, 2013 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, and is available to view on the SEC's website, www.sec.gov, or on BBX Capital's website, www.BBXCapital.com.

About BBX Capital Corporation:  
BBX Capital, a New York Stock Exchange listed company (NYSE: BBX), is involved in the acquisition, ownership and management of, and joint ventures and investments in real estate and real estate development projects as well as investments and management of middle market operating businesses. In addition, BBX Capital and its holding company, BFC Financial Corporation, have a 46% and 54% respective interest in Bluegreen. Bluegreen manages, markets and sells the Bluegreen Vacation Club, a flexible, points-based, deeded vacation ownership plan with more than 180,000 owners, over 60 owned or managed resorts, and access to more than 4,000 resorts worldwide.

As of March 31, 2014, BBX Capital had total consolidated assets of $416.9 million, shareholders' equity attributable to BBX Capital of approximately $304.6 million, and total consolidated equity of approximately $305.7 million, and its book value per share was $19.03. 

For further information, please visit our family of companies:
BBX Capital: www.BBXCapital.com
Bluegreen Corp.: www.BluegreenVacations.com
Renin Corp.: www.ReninCorp.com
Hoffman's Chocolates: www.Hoffmans.com, www.BocaBons.com, and
www.GoodFortunes.com
Williams & Bennett: www.WilliamsandBennett.com
RoboVault: www.RoboVault.com
BFC Financial Corp.: www.BFCFinancial.com

About BFC Financial Corporation :
BFC (OTCQB: BFCF) is a holding company whose principal holdings include a 52% ownership interest in BBX Capital Corporation (NYSE: BBX) and a 54% indirect ownership interest in Bluegreen Corporation. As of March 31, 2014, BFC had total consolidated assets of approximately $1.4 billion, shareholders' equity attributable to BFC of approximately $243.1 million, and total consolidated equity of approximately $430.2 million. For more information, visit www.BFCFinancial.com.

This press release contains forward-looking statements based on current expectations 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 and may include 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"), and involve substantial risks and uncertainties. We can give no assurance that such expectations will prove to be correct. Future results could differ materially as a result of a variety of risks and uncertainties, many of which are outside of the control of management. These risks and uncertainties include, but are not limited to the impact of economic, competitive and other factors affecting the Company and its assets, including the impact of decreases in real estate values or sustained high unemployment rates on our business generally, the ability of our borrowers to service their obligations and the value of collateral securing our loans; credit risks and loan losses, and the related sufficiency of the allowance for loan losses, including the impact of the economy and real estate market values on our assets and the credit quality of our loans; the risk that loan losses will continue and the risks of additional charge-offs, impairments and required increases in our allowance for loan losses; the impact of and expenses associated with litigation including but not limited to litigation brought by the SEC; adverse conditions in the stock market, the public debt market and other financial and credit markets and the impact of such conditions on our activities; the risk that the assets retained by the Company in CAM and FAR may not be monetized at the values currently ascribed to them; and the risks associated with the impact of periodic valuation of our assets for impairment. In addition, this press release contains forward looking statements relating to the Company's ability to successfully implement its currently anticipated business plans, which may not be realized as anticipated, if at all, and the Company's investments in real estate developments, real estate joint ventures and operating businesses may not achieve the returns anticipated or may not be profitable, including the Company's investment in Woodbridge and its acquisitions of Hoffman's, Williams & Bennett and Renin Corp. The Company's investments in real estate developments, either directly or through joint ventures, will increase exposure to downturns in the real estate and housing markets and expose us to risks associated with real estate development activities and the risk that our joint venture partners may not fulfill their obligations. The Company's investment in Woodbridge, which owns Bluegreen Corporation, exposes the Company to risks inherent in the time-share industry, which risks are identified in BFC's Annual Report on Form 10-K filed on March 17, 2014 with the SEC and available on the SEC's website, www.sec.gov. The Company's acquisition of Hoffman's, Williams & Bennett and Renin Corp. exposes us to the risks of Renin's, Hoffman's and Williams & Bennett's businesses, which in the case of Renin includes foreign currency exchange risk of the U.S. dollar compared to the Canadian dollar and Great Britain Pound, as well as the risk that the integration of these operating businesses may not be completed effectively or on a timely basis, and that the Company may not realize any anticipated benefits or profits from the transactions. Past performance and perceived trends may not be indicative of future results. In addition to the risks and factors identified above, reference is also made to other risks and factors detailed in reports filed by the Company with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the year ended December 31, 2013. The Company cautions that the foregoing factors are not exclusive. 

   
BBX CAPITAL CORPORATION AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - UNAUDITED  
        
  March 31,  December 31,  
(In thousands, except share data) 2014  2013  
ASSETS        
Cash and interest bearing deposits in banks ($2,645 and $8,686 in Variable Interest        
Entities ("VIE")) $32,919  43,138  
Loans held for sale ($50,716 and $53,846 in VIE)  50,716  53,846  
Loans receivable, net of allowance for loan losses of $1,588 and $2,713 ($44,587 and $56,170, net of allowance of $1,588 and $1,759 in VIE)  59,573  72,226  
Real estate held for investment ($25,248 and $15,836 in VIE)  108,430  107,336  
Real estate held for sale ($20,043 and $23,664 in VIE)  33,444  33,971  
Investment in unconsolidated real estate joint ventures  3,346  1,354  
Investment in Woodbridge Holdings, LLC  84,795  78,573  
Properties and equipment, net ($7,814 and $7,899 in VIE)  14,651  14,824  
Inventories  10,214  9,155  
Goodwill and other intangible assets  4,355  2,686  
Other assets ($2,096 and $2,413 in VIE)  14,452  14,038  
   Total assets $416,895  431,147  
LIABILITIES AND EQUITY        
Liabilities:        
BB&T preferred interest in FAR, LLC ($54,504 and $68,517 in VIE) $54,504  68,517  
Notes payable to related parties  22,012  21,662  
Notes payable  9,448  9,034  
Other liabilities ($12,010 and $12,355 in VIE)  25,247  28,368  
   Total liabilities  111,211  127,581  
Commitments and contingencies        
Equity:        
  Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued and outstanding  -  -  
  Class A common stock, $.01 par value, authorized 25,000,000 shares; issued and outstanding 15,810,588 and 15,778,088 shares  158  158  
  Class B common stock, $.01 par value, authorized 1,800,000 shares; issued and outstanding 195,045 and 195,045 shares  2  2  
  Additional paid-in capital  346,155  345,300  
  Accumulated deficit  (41,733 )(43,091 )
  Accumulated other comprehensive income  37  13  
Total BBX Capital Corporation shareholders' equity  304,619  302,382  
Noncontrolling interest  1,065  1,184  
Total equity  305,684  303,566  
   Total liabilities and equity $416,895  431,147  
   
   
BBX CAPITAL CORPORATION AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED  
          
          
   For the Three Months  
   Ended March 31,  
(In thousands, except share and per share data)  2014   2013  
Revenues:          
Sales  $16,867   -  
Interest income   1,776   3,045  
Net (losses) gains on the sales of assets   (49 ) 2,062  
Income from real estate operations   1,493   1,236  
Other   1,041   492  
   Total revenues   21,128   6,835  
Costs and expenses:          
Cost of goods sold   12,101   -  
BB&T's priority return in FAR distributions   331   1,013  
Interest expense   496   169  
Real estate operating expenses   1,553   1,076  
Selling, general and administrative expenses   11,507   8,185  
   Total costs and expenses   25,988   10,443  
Equity earnings in Woodbridge Holdings, LLC   6,222   -  
Recoveries from (provision for) loan losses   1,248   (759 )
Asset impairments, net   (1,319 ) (2,165 )
Income (loss) from continuing operations before income taxes   1,291   (6,532 )
Provision for income taxes   -   -  
Net income (loss)   1,291   (6,532 )
Less: net loss attributable to non-controlling interest   67   -  
Net income (loss) attributable to BBX Capital Corporation  $1,358   (6,532 )
Basic earnings (loss) per share  $0.08   (0.41 )
Diluted earnings (loss) per share  $0.08   (0.41 )
Basic weighted average number of common shares outstanding   15,985,772   15,785,870  
Diluted weighted average number of common and common equivalent shares outstanding   16,698,628   15,785,870  
   
   
Bluegreen Corporation  
Consolidated Statement of Operations - Unaudited  
For the Three Months Ended March 31, 2014  
(in thousands)  
   
Revenues:      
Sales of VOIs  $60,244  
Fee based sale commission and other revenues   27,115  
Other resort fee-based revenue   21,925  
Interest Income   20,636  
  Total revenues   129,920  
       
Costs and expenses:      
Cost of sales of VOIs   7,048  
Cost of sales of resort fee-based operations   13,223  
Selling, general and administrative expenses   72,805  
Interest expense   11,050  
  Total costs and expenses   104,126  
       
  Other income   513  
Income from continuing operations before taxes   26,307  
Provision for income taxes   (9,145 )
Income from continuing operations   17,162  
Loss from discontinued operations, net of taxes   (46 )
Net income   17,116  
Net income attributable to noncontrolling interest   (2,958 )
Net income attributable to Bluegreen  $14,158  
   
   
BBX Capital Equity Earnings in Woodbridge  
For the Three Months Ended March 31, 2014  
(in thousands)  
   
Net income attributable to Bluegreen  $14,158  
Woodbridge parent only net loss   (632 )
Net income attributable to Woodbridge   13,526  
BBX Capital interest in Woodbridge   46 %
BBX Capital Equity earnings in Woodbridge  $6,222  
   
   
BLUEGREEN CORPORATION  
Supplemental Financial Information For the Three Months Ended March 31, 2014 - Unaudited  
(dollars in thousands)  
   
   Amount   % of System-wide sales of VOIs, net(5)  
           
Legacy VOI sales (1)  $32,005   29 %
VOI sales-secondary market   18,953   17 %
Sales of third-party VOIs-commission basis   42,092   38 %
Sales of third-party VOIs-just-in-time basis   16,815   16 %
System-wide sales of VOIs, net   109,865   100 %
Less: Sales of third-party VOIs-commission basis   (42,092 ) -38 %
Gross sales of VOIs   67,773   62 %
Estimated uncollectible VOI notes receivable (2)   (7,529 ) -11 %
Sales of VOIs   60,244   55 %
Cost of VOIs sold (3)   (7,048 ) -12 %
Gross profit (3)   53,196   88 %
Fee-based sales commission revenue (4)   27,115   64 %
Other fee-based services revenue   21,925   20 %
Cost of other fee-based services   (11,234 ) -10 %
Net carrying cost of VOI inventory   (1,989 ) -2 %
Selling and marketing expenses   (52,887 ) -48 %
General and administrative expenses   (19,918 ) -18 %
Net interest spread   9,586   9 %
Operating profit  $25,794   23 %
Other income, net   513      
Income from continuing operations          
before income taxes   26,307      

(1) Legacy VOI sales represent sales of Bluegreen-owned VOIs acquired or developed under Bluegreen's traditional VOI business. Legacy VOI sales do not include Secondary Market, Commission Basis, or Just-In-Time VOI sales under Bluegreen's Capital-Light business strategy.
(2) Percentages for estimated uncollectible VOI notes receivable are calculated as a percentage of gross sales of VOIs (and not of system-wide sales of VOIs, net).
(3) Percentages for costs of VOIs sold and gross profit are calculated as a percentage of sales of VOIs (and not of system-wide sales of VOIs, net).
(4) Percentage for Fee-based sales commission revenue is calculated based on sales of third-party VOIs-commission basis (and not of system-wide sales of VOIs, net).
(5) Unless otherwise indicated.

   
   
BLUEGREEN CORPORATION  
Supplemental Financial Data and Reconciliation of Woodbridge's Income from Continuing Operations to Bluegreen's Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA")  
For the Three Months Ended March 31, 2014 - Unaudited  
(in thousands)  
       
Consolidated Woodbridge income from continuing operations  $16,530  
Less:      
  Parent only (Woodbridge) loss from continuing operations   632  
Bluegreen income from continuing operations   17,162  
Plus/(Less):      
  Long-term executive compensation   1,105  
  Interest income (other than interest earned on VOI notes receivable)   (290 )
  Interest expense   11,050  
  Interest expense on receivable-backed debt   (6,124 )
  Provision for income taxes   9,145  
  Franchise taxes   44  
  Depreciation and amortization   1,708  
Adjusted EBITDA  $33,800  
         

Bluegreen's Adjusted EBITDA is defined as Bluegreen's earnings, or income from continuing operations, before taking into account its long-term executive compensation, interest income (excluding interest earned on Bluegreen's VOI notes receivable), interest expense (excluding interest expense incurred on financings related to Bluegreen's receivable-backed notes payable), provision for income taxes and franchise taxes, depreciation and amortization. For purposes of the Adjusted 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 Bluegreen considers both to be part of its business operations.

We consider Adjusted EBITDA to be an indicator of Bluegreen's operating performance, and it is used to measure Bluegreen's ability to service debt, fund capital expenditures and expand its business. It 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. 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. Adjusted 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 depreciation and amortization expense among companies.

 
 
Woodbridge Holdings, LLC
Consolidating Statement of Financial Condition - Unaudited
(in thousands)
 
   As of March 31, 2014  As of December 31, 2013
 
 
 
 
 
Bluegreen
 
 
Woodbridge
Parent only
 
 
 
 
Consolidated
Woodbridge
 
 
 
Bluegreen
 
 
Woodbridge
Parent only
 
 
 
 
Consolidated
Woodbridge
Assets                     
                      
Cash and cash equivalents  $134,957  14,726   149,683  158,096  723   158,819
Restricted cash ($36,207 and $36,263 in VIEs at March 31, 2014 and December 31, 2013, respectively)   
68,811
 
-
  
68,811
 
65,285
 
-
  
65,285
Notes receivable, net ($329,739 and $342,078 in VIEs at March 31, 2014 and December 31, 2013, respectively)   
431,156
 
11,750
  
442,906
 
455,569
 
11,750
  
467,319
Inventory   207,801  -   207,801  204,256  -   204,256
Property and equipment, net   66,627  -   66,627  63,252  -   63,252
Intangible assets   64,084  -   64,084  64,142  -   64,142
Other assets   91,735  2,590   94,325  60,486  2,756   63,242
  Total assets  $1,065,171  29,066   1,094,237  1,071,086  15,229   1,086,315
                      
Liabilities and Equity                     
                      
Accounts payable, accrued liabilities and other   116,569  620   117,189  116,304  652   116,956
Deferred tax liability, net   85,844  -   85,844  76,726  -   76,726
Receivable-backed notes payable - recourse ($4,912 and $5,899 in VIE at March 31, 2014 and December 31, 2013, respectively)   
74,616
 
-
  
74,616
 
74,802
 
-
  
74,802
Receivable-backed notes payable - nonrecourse   354,866  -   354,866  368,759  -   368,759
Notes and mortgage notes payable   89,464  -   89,464  93,939  -   93,939
Junior subordinated debentures   63,020  85,052   148,072  62,379  85,052   147,431
  Total liabilities   784,379  85,672   870,051  792,909  85,704   878,613
                      
Stockholders' equity                     
Total Bluegreen Corporation shareholders' equity   240,113  (56,606 ) 183,507  240,456  (70,475 ) 169,981
Noncontrolling interest   40,679  -   40,679  37,721  -   37,721
  Total equity   280,792  (56,606 ) 224,186  278,177  (70,475 ) 207,702
  Total liabilities and equity  $1,065,171  29,066   1,094,237  1,071,086  15,229   1,086,315

Contact Information

  • BBX Capital Contact Info:
    Investor Relations:
    Leo Hinkley
    Managing Director, Investor Relations Officer
    954- 940-5300
    Email: InvestorRelations@BBXCapital.com

    Media contact:
    Caren Berg
    Boardroom Communications
    (954) 370-8999
    Email: cberg@boardroompr.com