Tejon Ranch (NYSE:TRC) reported higher third-quarter earnings and adjusted EBITDA, helped by farming proceeds and growth across several operations, while executives acknowledged that some of the gains reflected timing and items that may not recur.
Net income attributable to common stockholders rose to $3.3 million, or $0.12 per share, from $1.7 million, or $0.06 per share, a year earlier. Adjusted EBITDA nearly doubled to $10.4 million from $5.3 million, Chief Financial Officer Robert Velasquez said on the company’s third-quarter 2026 earnings call.
President and CEO Matthew Walker said revenue, net income and adjusted EBITDA were all ahead of the prior-year quarter. He also emphasized the need to distinguish recurring performance from exceptional items, including a second-quarter land-sale contribution to an industrial joint venture with Dedeaux Properties.
Farming proceeds lift results
Third-quarter revenue included $3.9 million in crop insurance proceeds and $2.6 million in bonus price adjustments tied to the prior year’s pistachio crop, Velasquez said. An earlier harvest also shifted wine grape sales into the third quarter that would normally have occurred later in the year.
Adjusted farming EBITDA before fixed water obligations rose to $2.6 million from $425,000 a year earlier. Velasquez said warm spring weather affected almond nut sizing and would be reflected in total yield reported at year-end.
Elsewhere, mineral resources revenue increased 25%, and operating income rose nearly 58%. National Cement exercised a 20-year lease extension, Velasquez said. Industrial occupancy stood at 100% and commercial occupancy at 95%, while multifamily revenue increased to $924,000 from $181,000 as leasing progressed at Terra Vista.
Corporate expenses, including share-based compensation adjustments, declined 40% for the quarter and 22% year to date after adjusting for nonrecurring costs in the prior year, according to Velasquez.
Development projects advance
Walker said Building 1B at the Tejon Ranch Commerce Center, being developed with Dedeaux Properties, remained under construction and was on track for completion early next year. He said the joint venture’s use of third-party equity was a model the company intended to repeat.
The Tejon Indian Tribe and Hard Rock International have also broken ground on the next phase of Hard Rock Casino Tejon, including a 406-room hotel and entertainment venue. Walker said he expects the investment to benefit the Commerce Center and expand its customer base.
In residential development, the Kern County Board of Supervisors approved an amendment to the Grapevine Specific Plan in late September, updating its land-use mix and phasing. Walker said the approval brings the first phase closer to mapping and market.
At Centennial, Tejon Ranch is processing an updated application with Los Angeles County and expects to appear before the Regional Planning Commission in the coming months, followed by the county Board of Supervisors. The company is also seeking capital partners for the fully entitled Tejon Mountain Village, Walker said.
Investors press for lower costs and debt
Tejon Ranch ended September with approximately $74.4 million in liquidity, comprising $8.8 million in cash and marketable securities and $65.6 million available under its revolving credit facility. Total debt was $94.4 million, or approximately 16% of total capitalization, Velasquez said.
During a question-and-answer session using submissions from shareholders, David Ross of Praxis Partners cited a $16 million year-to-date increase in net debt and asked when management and the board would materially reduce debt and costs.
Walker said actual borrowings had increased by $500,000 and that the company had generated more than $7 million in cash from operations year to date, compared with approximately $4 million consumed in the prior-year period. He said reductions in the credit line’s principal would follow cash-generating activities and acknowledged that more work remained.
Responding to another question about the company’s cost structure, Walker said Tejon Ranch would continue to reduce controllable costs and examine discretionary capital spending. He said the company must weigh the capital, risk and expected returns involved in growing revenue and producing durable earnings.
Walker also addressed concerns about the share price and asset value. He said a prior company presentation estimated the Commerce Center’s net asset value at $14 to $20 per share based on 2024 financials, excluding water assets. He said Tejon Ranch was working to convert assets into cash flow, reduce costs and deploy capital with discipline, but did not provide a detailed timetable.
About Tejon Ranch (NYSE:TRC)
Tejon Ranch Co is a diversified land and real estate development company based in California. It manages the approximately 270,000-acre Tejon Ranch, one of the largest contiguous private landholdings in the state, located primarily in Kern County near the southern San Joaquin Valley and the Tejon Pass connecting the Central Valley and the Los Angeles region.
The company’s principal activities include commercial, industrial, residential and resort development, as well as agriculture and resource management.
