Bluegreen Corporation Reports 2012 Third Quarter Financial Results

Bluegreen Corporation Reports 2012 Third Quarter Financial Results

Q3 2012 Overview

  • Bluegreen Resorts ("Resorts") system-wide sales of vacation ownership interests ("VOIs") increased 19.9% to $109.1 million from $91.0 million in Q3 2011.

  • Sales of VOIs made on behalf of Resorts' fee-based services clients, which are included in system-wide sales above, rose 22.7% to $41.7 million from $34.0 million in Q3 2011.

  • Income from continuing operations attributable to Bluegreen shareholders (defined as income from continuing operations after tax less net income attributable to non-controlling interest) rose 24.1% to $12.0 million, or $0.38 per diluted share, from $9.7 million, or $0.30 per diluted share, in Q3 2011.

  • Net income rose to $11.7 million, or $0.37 per diluted share, from net income of $7.1 million, or $0.22 per diluted share, in Q3 2011. Q3 2011 included a loss from discontinued operations of $2.6 million, or $0.08 per diluted share, related to Bluegreen Communities, substantially all of the assets of which were sold in May 2012. Q3 2012 loss from discontinued operations of approximately $0.3 million, or $0.01 per diluted share, was related to expenses incurred to satisfy a portion of the obligations of Bluegreen Communities not assumed by the buyer.

  • Unrestricted cash and cash equivalents at September 30, 2012 of $100.2 million.

BOCA RATON, Fla.--(BUSINESS WIRE)-- Bluegreen Corporation (NYSE: BXG) , a leading timeshare sales, marketing and resort management company, today announced financial results for the quarter and nine months ended September 30, 2012.


John M. Maloney Jr., President and Chief Executive Officer of Bluegreen, commented, "We performed well in the third quarter of 2012, as evidenced by growth at both our traditional VOI and fee-based services businesses, as well as increases in sales tours and sale-to-tour conversion ratios. Our fee-based services business represented approximately 39% and 37% of total system-wide VOI sales for the three and nine months ended September 30, 2012, respectively, up from approximately 37% and 34% in the same respective periods last year. In September, we completed the sale of $100 million of investment-grade timeshare loan-backed notes in a term securitization transaction. This transaction allowed us to refinance at a 2.94% fixed interest rate receivables that were previously pledged under certain of our variable-rate credit facilities, and create approximately $60 million of additional availability under existing receivable-backed credit facilities. Through the first nine months of 2012, we generated free cash flow (defined as cash flow from operating and investing activities) of $138.7 million (including $27.8 million of proceeds from the sale of Bluegreen Communities, prior to the payment of $22.7 million of Bluegreen Communities' debt and related fees) and reduced outstanding debt by approximately $107.3 million."

Additional Q3 2012 operating highlights included:

  • In connection with its fee-based services business, Resorts sold $41.7 million of third-party VOIs in Q3 2012, generating sales and marketing commissions of approximately $27.8 million. This compares to sales of $34.0 million of third-party VOIs in Q3 2011, which generated sales and marketing commissions of $23.5 million.

  • Total revenues from fee-based services rose 11.6% to $47.2 million in Q3 2012 from $42.3 million in Q3 2011. Fee-based services contributed an estimated $16.5 million to Resorts operating profit in Q3 2012, compared to an estimated $14.5 million in Q3 2011. As of September 30, 2012, Bluegreen managed 46 timeshare resort properties compared to 45 as of September 30, 2011.

BLUEGREEN RESORTS

Supplemental Financial Data and Reconciliation of System-Wide Sales of VOIs to GAAP Gross Sales of VOIs

Three and Nine Months Ended September 30, 2012 and 2011

(In 000's, except percentages) (Unaudited)

Three Months Ended September 30, 2012

Three Months Ended September 30, 2011

% of

% of

Traditional

Fee-Based

System-wide

Traditional

Fee-Based

System-wide

Timeshare

Services

sales of VOIs,

Timeshare

Services

sales of VOIs,

Business

Business

Total

net(6)

Business

Business

Total

net(6)

System-wide sales of VOI's (1)

$

67,421

$

41,698

$

109,119

56,993

$

33,983

$

90,976

Change in sales deferred under timeshare

accounting rules

(2,095

)

-

(2,095

)

(335

)

-

(335

)

System-wide sales of VOIs, net (1)

65,326

41,698

107,024

100

%

56,658

33,983

90,641

100

%

Less: Sales of third-party VOIs

-

(41,698

)

(41,698

)

(39

)

-

(33,983

)

(33,983

)

(37

)

Gross sales of VOIs

65,326

-

65,326

61

56,658

-

56,658

63

Estimated uncollectible VOI

notes receivable (2)

(8,354

)

-

(8,354

)

(13

)

(10,770

)

-

(10,770

)

(19

)

Sales of VOIs

56,972

-

56,972

53

45,888

-

45,888

51

Cost of VOIs sold (3)

(12,590

)

-

(12,590

)

(22

)

(11,349

)

-

(11,349

)

(25

)

Gross profit (3)

44,382

-

44,382

78

34,539

-

34,539

75

Fee-based sales commission revenue

-

27,798

27,798

26

-

23,460

23,460

26

Other resort fee-based services revenues

-

19,401

19,401

18

-

18,838

18,838

21

Cost of other resort fee-based services

-

(9,083

)

(9,083

)

(8

)

-

(10,550

)

(10,550

)

(12

)

Net carrying cost of VOI inventory

(1,333

)

(1,333

)

(1

)

(2,362

)

-

(2,362

)

(3

)

Selling and marketing expense (4)

(30,375

)

(19,388

)

(49,763

)

(46

)

(25,462

)

(15,272

)

(40,734

)

(45

)

Resorts G & A expense (4)

(3,441

)

(2,196

)

(5,637

)

(5

)

(3,334

)

(2,000

)

(5,334

)

(6

)

Bluegreen Resorts operating profit (5)

$

9,234

$

16,531

$

25,765

24

%

$

3,381

$

14,476

$

17,857

20

Nine Months Ended September 30, 2012

Nine Months Ended September 30, 2011

% of

% of

Traditional

Fee-Based

System-wide

Traditional

Fee-Based

System-wide

Timeshare

Services

sales of VOIs,

Timeshare

Services

sales of VOIs,

Business

Business

Total

net(6)

Business

Business

Total

net(6)

System-wide sales of VOI's (1)

$

179,236

$

100,813

$

280,049

150,755

$

77,844

$

228,599

Change in sales deferred under timeshare

accounting rules

(6,249

)

-

(6,249

)

(1,639

)

-

(1,639

)

System-wide sales of VOIs, net (1)

172,987

100,813

273,800

100

%

149,116

77,844

226,960

100

%

Less: Sales of third-party VOIs

-

(100,813

)

(100,813

)

(37

)

-

(77,844

)

(77,844

)

(34

)