Florida farming proves tough

Florida farming is proving to be a tough business for some New York investors.

Investors including 734 Agriculture earlier this year purchased a controlling 51% stake of the publicly traded shares of Fort Myers-based agribusiness giant Alico from the heirs of Florida citrus baron Ben Hill Griffin Jr.

Since they took over in the spring, Alico's new executives and board of directors slashed the company's quarterly dividend and got out of the sugarcane production business, choosing to lease sugarcane fields to U.S. Sugar.

But the vicissitudes of farm prices have crimped sales and profits lately. Alico reported net income of $1.1 million on sales of $28.7 million in the third quarter ending June 30, compared with net income of $4.1 million on sales of $35.2 million in the same quarter in 2013.

Part of that was the one-time charge of $2.3 million related to the sugarcane deal, but lower prices for fruit didn't help either. The company grows citrus and raises cattle on 130,700 acres in Central and Southwest Florida.