CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This quarterly report on Form 10-Q (this “Quarterly Report”) and other reports filed by us with the U.S. Securities and Exchange Commission (the “SEC”) contain “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These statements relate to future events or our future financial performance and are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These statements include all statements included in or incorporated by reference to this Quarterly Report that are not statements of historical facts, which can generally be identified by words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “project,” “pursue,” “will,” “would,” or the negative or other variations thereof or comparable terminology. We caution you that the foregoing list may not include all of the forward-looking statements made in this Quarterly Report. Actual results could differ materially from those projected in forward-looking statements as a result of the following factors, among others:

 

•

the occurrence of natural disasters such as the Maui wildfires that occurred on August 8, 2023, changes in weather conditions, or threats of the spread of contagious diseases, such as the COVID-19 pandemic and its variants;

 

•

concentration of credit risk on deposits held at banks in excess of the Federal Deposit Insurance Corporation (the “FDIC”) insured limits and in receivables due from our commercial leasing portfolio;

 

•

unstable macroeconomic market conditions, including, but not limited to, energy costs, credit markets, interest rates, tariffs, inflationary pressures, and changes in income and asset values;

 

•

risks associated with real estate investments, including demand for real estate and tourism in Hawai‘i and Maui;

 

•

security incidents through cyber-attacks or intrusions on our information systems;

 

	•	our ability to complete land development projects within forecasted time and budget expectations;
	•	risks associated with crop damages and losses;

 

•

our ability to obtain required land use entitlements at reasonable costs;

 

•

our ability to compete with other developers of real estate on Maui;

 

•

risks associated with joint ventures;

 

•

potential liabilities and obligations under various federal, state, and local environmental regulations;

 

•

our ability to cover catastrophic losses in excess of insurance coverages;

 

•

unauthorized use of our trademarks could negatively impact our business;

 

•

our ability to establish and maintain effective internal controls over financial reporting;

 

•

our ability to comply with funding requirements of our retirement plans;

 

•

our ability to comply with the terms of our indebtedness, including financial covenants, and to extend maturity dates, or refinance such indebtedness, prior to its maturity date;

 

•

availability of capital on terms favorable to us, and our ability to raise capital through the sale of certain real estate assets, or at all;

 

•

risks related to our common stock, including stock price volatility, low trading volume and affiliate ownership; and

 

•

changes in U.S. accounting standards adversely impacting us.

 

 

Such risks and uncertainties also include those risks and uncertainties discussed in the sections entitled “Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024 (the “Annual Report”) and the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report, as well as other factors described from time to time in our reports filed with the SEC. Although we believe that our opinions and expectations reflected in the forward-looking statements are reasonable as of the date of this Quarterly Report, we cannot guarantee future results, levels of activity, performance or achievements, and our actual results may differ substantially from the views and expectations set forth in this Quarterly Report. Thus, you should not place undue reliance on any forward-looking statements. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Further, any forward-looking statements speak only as of the date made and, except as required by law, we undertake no obligation to publicly revise our forward-looking statements to reflect events or circumstances that arise after the date of this Quarterly Report. We qualify all of our forward-looking statements by these cautionary statements.

 

 

PART I FINANCIAL INFORMATION

 

Item 1. FINANCIAL STATEMENTS

 

MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

See Notes to Condensed Consolidated Interim Financial Statements

 

 

MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

 

(UNAUDITED)

 

 

See Notes to Condensed Consolidated Interim Financial Statements

 

 

MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

 

(UNAUDITED)

 

 

See Notes to Condensed Consolidated Interim Financial Statements

 

 

MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

 

For the Three and Six Months Ended June 30, 2025 and 2024

(UNAUDITED)

(in thousands)

 

 

See Notes to Condensed Consolidated Interim Financial Statements.

 

 

MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(UNAUDITED)

 

 

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

 

●

Common stock issued under the Company’s 2017 Equity and Incentive Award Plan was $1.2 million and $0.7 million for the six months ended June 30, 2025 and 2024, respectively.

 

	●	Capitalized property and deferred development costs in accounts payable were $0.5 million and $0 at June 30, 2025 and 2024, respectively.
	●	Assets transferred from deferred development to assets held for sale were $1.5 million and $0 at June 30, 2025 and 2024, respectively

 

See Notes to Condensed Consolidated Interim Financial Statements.

 

  

MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES

 

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (UNAUDITED)

 

For the Three and Six Months Ended June 30, 2025 and 2024

 

 

1.	BASIS OF PRESENTATION

 

The accompanying unaudited condensed consolidated interim financial statements have been prepared by Maui Land & Pineapple Company, Inc. (together with its subsidiaries, the “Company”) in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information that are consistent in all material respects with those applied in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “Annual Report”), and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and notes to the annual audited consolidated financial statements required by GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed consolidated interim financial statements contain all normal and recurring adjustments necessary to fairly present the Company’s consolidated financial position, results of operations and cash flows for the interim periods ended June 30, 2025 and 2024. The unaudited condensed consolidated interim financial statements and notes should be read in conjunction with the annual audited consolidated financial statements and notes thereto included in the Annual Report.

 

Maui Land & Pineapple Company, Inc. is a Delaware corporation and the successor to a business organized in 1909 as a Hawai‘i corporation. The Company reincorporated from Hawai‘i to Delaware pursuant to a plan of conversion completed on July 18, 2022. Total authorized capital stock of the Company includes 48,000,000 shares, consisting of 43,000,000 shares of common stock, par value $0.0001 per share, and 5,000,000 shares of preferred stock, par value $0.0001 per share. Shares of the Company’s common stock are listed on the New York Stock Exchange (“NYSE”) under the ticker symbol “MLP.”

 

2.	CASH AND CASH EQUIVALENTS

 

Cash and cash equivalents include cash on hand, deposits in banks, and money market funds.

 

3.	INVESTMENTS IN DEBT SECURITIES

 

Held-to-maturity debt securities are stated at amortized cost. Investments are reviewed for impairment for each reporting period. If any impairment is considered other-than-temporary, an allowance for credit loss would be established and held-to-maturity debt securities will be presented net of the credit loss allowance. Adjustments to expected credit losses are recorded as a component of other income (expense).

 

Amortized cost and fair value of corporate debt securities at  June 30, 2025 and December 31, 2024 consisted of the following:

 

		June 30,				December 31,
		2025				2024
		(unaudited)				(audited)
		(in thousands)
Amortized cost		$	492			$	2,687
Unrealized gains			-				5
Fair value		$	492			$	2,692

 

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Maturities of debt securities at June 30, 2025 and December 31, 2024 were as follows: 

 

		June 30, 2025 (unaudited)								December 31, 2024 (audited)
						(in thousands)
		Amortized Cost				Fair Value				Amortized Cost				Fair Value
One year or less		$	492			$	492			$	2,687			$	2,692
Greater than one year through five years			-				-				-				-
		$	492			$	492			$	2,687			$	2,692

 

The fair value of debt securities was measured using Level 1 inputs, which are based on quotes for trades occurring in active markets for identical assets.

 

4.	DEFERRED DEVELOPMENT COSTS - DEVELOPMENT PROJECTS

 

Deferred development costs - development projects represents costs expended on the Company's various real estate development projects and capitalized in accordance with Accounting Standards Codification (ASC) ASC-360-10. The amounts capitalized at June 30, 2025 and 2024, were $13.7 million and $14.4 million, respectively.

  

 

5.	DEFERRED DEVELOPMENT COSTS - AGAVE VENTURE

 

Deferred development costs - Agave venture represents costs expended on the Company's new Agave venture and capitalized in accordance with ASC-360-10. The amounts capitalized at June 30, 2025 and 2024, were $0.6 million and $30,000, respectively.

 

    

6.	PROPERTY & EQUIPMENT, NET

 

Property and equipment, net at June 30, 2025 and December 31, 2024 consisted of the following:

 

		June 30,				December 31,
		2025				2024
		(unaudited)				(audited)
		(in thousands)
Land		$	7,706			$	7,715
Land improvements			12,633				13,158
Buildings			20,345				22,976
Machinery and equipment			6,829				9,124
Construction in progress			448				1,367
Total property and equipment			47,961				54,340
Less accumulated depreciation			(30,427	)			(36,939	)
Property and equipment, net		$	17,534			$	17,401

 

Land

 

Most of the Company’s 22,300 acres of land were acquired between 1911 and 1932 and are carried in its balance sheets at cost. More than 20,000 acres are located in West Maui and are largely contiguous parcels that extend from the sea to an elevation of approximately 5,700 feet. This area includes approximately 900 acres entitled for mixed-use development within the Kapalua Resort, a master-planned, destination resort and residential community located in West Maui. The Company’s remaining approximate 1,500 acres of land are located in Upcountry Maui in an area commonly known as Hali‘imaile and are mainly comprised of agricultural fields, ranch lands and industrial and retail properties.

 

Land Improvements

 

Land improvements are comprised primarily of roads, utilities, and landscaping infrastructure improvements at the Kapalua Resort. Also included is the Company’s potable and non-potable water systems in West Maui. A majority of the Company’s land improvements were constructed and placed in service in the mid-to-late 1970s or conveyed in 2017. Depreciation expense would be considerably higher if these assets were stated at current replacement cost.

 

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Buildings

 

Buildings are comprised of restaurant, retail, and light industrial spaces located at the Kapalua Resort, Alaeloa Business Center, and Hali‘imaile, which are used in the Company’s leasing operations. Most of the Company’s buildings were constructed and placed in service in the mid-to-late 1970s. Depreciation expense would be considerably higher if these assets were stated at current replacement cost.

 

Machinery and Equipment

 

Machinery and equipment are mainly comprised of zipline course equipment installed in 2008 at the Kapalua Resort and used in the Company’s leasing operations and various rolling stock and off road equipment used in our land management and Agave farming operations.

 

Construction in Progress

 

Construction in progress is comprised of ongoing Kapalua Resort and Hal‘iimaile projects, including renovations and improvements to buildings, warehouses and commercial assets.

 

7.	INVESTMENT IN UNCONSOLIDATED JOINT VENTURE

 

In  December 2023, the Company entered into a joint venture agreement with a local developer to form a Hawai‘i limited liability company ("BRE2 LLC"). The Company's initial capital contribution to BRE2 LLC consisted of approximately 31 acres of former pineapple lands in Hali‘imaile valued at $1.6 million. The first lot sold for $1.8 million in  December 2024 and the second lot sold for $2.4 million in  February of 2025. The Company received a distribution from BRE2 LLC in the amount of $1.0 million during the year ended  December 31, 2024. Distributions of approximately $0.7 million were received in the first quarter of 2025 and an additional $0.5 million equity distribution was received in April 2025.

 

8.	CONTRACT ASSETS AND LIABILITIES

 

Receivables from contracts with customers were $1.1 million and $4.3 million at June 30, 2025 and December 31, 2024, respectively. Billings in excess of costs and revenues were $0 and $3.2 million at June 30, 2025 and December 31, 2024, respectively.

 

Deferred license fee revenue

 

Effective April 1, 2020, the Company entered into a trademark license agreement (the “Agreement”) with Kapalua Golf (the “Licensee”), the owner of Kapalua Plantation and Bay golf courses. Under the terms and conditions set forth in the Agreement, the Licensee is granted a perpetual, terminable on default, transferable, non-exclusive license to use the Company’s trademarks and service marks to promote its golf courses and to sell its licensed products. The Company received a single royalty payment of $2.0 million in March 2020. Revenue recognized on a straight-line basis over its estimated economic useful life of 15 years was $66,667 for each of the six months ended June 30, 2025 and 2024.

 

9.	LONG-TERM DEBT

 

Long-term debt is comprised of amounts outstanding under the Company’s $15.0 million revolving line of credit facility (“Credit Facility”) with First Hawaiian Bank (“Bank”) maturing on December 31, 2025. At June 30, 2025, $12.0 million was available from our Credit Facility, as the Company borrowed $3,000,000 during the year ended December 31, 2024. The Credit Facility provides options for revolving or term loan borrowing. Interest on loan borrowing is based on the Bank’s prime rate minus 1.125 percentage points. Interest on term loan borrowing may be fixed at the Bank’s commercial loan rates using an interest rate swap option. The Company has pledged approximately 30,000 square feet of commercial leased space in the Kapalua Resort as security for the Credit Facility. Net proceeds from the sale of any collateral are required to be repaid toward outstanding borrowings and will permanently reduce the Credit Facility’s revolving commitment amount. There are no commitment fees on the unused portion of the Credit Facility. The interest rate on this Credit Facility was 6.375% and 6.625% at June 30, 2025 and December 31, 2024, respectively.

 

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The terms of the Credit Facility include various representations, warranties, affirmative, negative and financial covenants and events of default customary for financings of this type. Financial covenants include a minimum liquidity (as defined) of $2.0 million, a maximum of $45.0 million in total liabilities, and a limitation of new indebtedness on collateralized properties without the prior written consent of the Bank.

 

The outstanding balance of the Credit Facility was $3,000,000 at June 30, 2025 and December 31, 2024. The Company was in compliance with the debt covenants for the Credit Facility at June 30, 2025.

 

10.	ACCRUED RETIREMENT BENEFITS

 

Accrued retirement benefits at June 30, 2025 and December 31, 2024 consisted of the following:

 

		June 30,				December 31,
		2025				2024
		(unaudited)				(audited)
		(in thousands)
Defined benefit pension plan		$	7,230			$	912
Non-qualified retirement plans			1,578				1,596
Total			8,808				2,508
Less current portion			(7,370	)			(140	)
Non-current portion of accrued retirement benefits		$	1,438			$	2,368

 

The Company has a defined benefit pension plan (the “Defined Plan”), which covers many of its former bargaining unit employees and an unfunded non-qualified retirement plan (the “Non-qualified Plan”) covering nine former non-bargaining unit management employees and former executives. In 2009, the Non-qualified Plan was frozen, and in 2011, the pension benefits under the Defined Plan were frozen. All future vesting of additional benefits were discontinued effective in 2009 for the Non-qualified Plan and in 2011 for the Defined Plan. The Board of Directors (the “Board”) approved the termination of the Defined Plan and the Non-qualified Plan in 2023.

 

The net periodic benefit costs for pension and post-retirement benefits for the three and six months ended June 30, 2025 and 2024 were as follows:

 

		Three Months Ended June 30, (unaudited)								Six Months Ended June 30, (unaudited)
		2025				2024				2025				2024
		(in thousands)								(in thousands)
Pensions and other benefits:
Interest cost		$	105			$	184			$	210			$	368
Expected return on plan assets			(72	)			(174	)			(245	)			(348	)
Amortization of net loss			-				68				79				136
Settlement expense			549				-				7,457				-
Pension and other postretirement expenses		$	582			$	78			$	7,501			$	156

 

Plan cash contributions in the amount of $1,060,000 were made to the Defined Plan during the six months ended June 30, 2025. No contributions were required in 2024.

 

A settlement expense in the amount of $7,457,000 was recognized during the six months ended June 30, 2025. This expense includes $6,397,000 in non-cash expense to recognize the most current estimated costs to terminate the qualified pension plan, as well as a cash contribution to the plan in the amount of $1,060,000 made during the six months ended June 30, 2025. No contributions to the plan were required in 2024. Final settlement expenses will be recognized upon the final termination of the qualified plan which is anticipated to be completed during the third quarter of 2025. There was no settlement expense incurred during the six months ended June 30, 2024.

 

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11.	COMMITMENTS AND CONTINGENCIES

 

On December 31, 2018, the State of Hawai‘i Department of Health (“DOH”) issued a Notice and Finding of Violation and Order (“Order”) for alleged wastewater effluent violations related to the Company’s Upcountry Maui wastewater treatment facility. The facility was built in the 1960s to serve approximately 200 single-family homes developed for workers in the Company’s former agricultural operations. The facility is comprised of two 1.5-acre wastewater stabilization ponds and surrounding disposal leach fields. The Order includes, among other requirements, payment of a $230,000 administrative penalty and development of a new wastewater treatment plant, which become final and binding unless a hearing is requested to contest the alleged violations and penalties.

 

The construction of additional leach fields and installation of a surface aerator, sludge removal system, and natural pond cover using water plants were completed in 2023. Test results from wastewater monitoring indicate effluent concentration amounts within allowable ranges. A feasibility study was prepared for and submitted to the Company on January 15, 2024, identifying various technical solutions that could be implemented to resolve the Order. The DOH agreed to defer the Order on February 15, 2024, as the Company continues to work to resolve and remediate the facility’s wastewater effluent issues through an approved corrective action plan. The Company submitted a plan (the Plan) and proposed solution to resolve the Order on March 14, 2024. The Plan included the installation of an additional pond that will be lined and installed with aerators. One of the existing ponds will be lined and renovated as necessary and the other pond will be taken offline and used as a backup pond if needed. The Company continues to work with the DOH to coordinate the timing and approval of the Plan to implement the technical solution to resolve the Order. Meetings continue to be scheduled to provide status updates and progress being made towards resolution.

 

In addition, from time to time, the Company is the subject of various other claims, complaints and other legal actions which arise in the normal and ordinary course of the Company’s business activities. The Company believes the resolution of these other matters, in the aggregate, is not likely to have a material adverse effect on the Company’s consolidated financial position or operations.

 

 

12.	LEASING ARRANGEMENTS

 

The Company leases land primarily to agriculture operators and leases space in commercial buildings primarily to restaurant and retail tenants with terms continuing through 2048. These operating leases generally provide for minimum rents for commercial properties and land assets and, in some cases, licensing fees for use of trade names, percentage rentals based on tenant revenues, and reimbursement of common area maintenance and other expenses. Certain leases allow the lessee an option to extend or terminate the agreement. There are no leases allowing a lessee an option to purchase the underlying asset. Leasing revenues subject to Accounting Standards Codification Topic 842 for the three and six months ended June 30, 2025 and 2024 were as follows:

 

		Three Months Ended June 30, (unaudited)								Six Months Ended June 30, (unaudited)
		2025				2024				2025				2024
		(in thousands)								(in thousands)
Minimum rentals		$	1,214			$	1,058			$	2,530			$	2,022
Percentage rentals			590				444				1,187				1,049
Licensing fees			41				36				72				69
Other			349				184				643				351
Total		$	2,194			$	1,722			$	4,432			$	3,491

 

 

 

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13.	SHARE-BASED COMPENSATION

 

The Company's directors and certain members of management receive a portion of their compensation in shares of the Company's common stock granted under the Company's 2017 Equity and Incentive Award Plan, as amended (the "Equity Plan"). Restricted share-based compensation is valued based on the average of the high and low share price on the date of grant. Shares are issued upon execution of agreements reflecting the grantee’s acceptance of the respective shares subject to the terms and conditions of the Equity Plan. Restricted shares issued under the Equity Plan have voting and regular dividend rights but cannot be disposed of until such time as they are vested. All unvested restricted shares are forfeited upon the grantee’s termination of directorship or employment from the Company.

 

Certain members of the Company’s management are awarded share-based compensation based on their achievement of predefined performance goals and objectives under the Equity Plan. Their share-based compensation is comprised of an annual incentive paid in shares of common stock and a long-term incentive paid in restricted shares of common stock vesting quarterly over a period of three years. Directors receive share-based compensation comprised of restricted shares of common stock vesting quarterly over the directors’ annual period of service.

 

Options to purchase shares of the Company’s common stock under the Equity Plan were granted to directors and the Chief Executive Officer in 2024 and 2023. Stock option grants are valued at the commitment date, based on the fair value of the equity instruments, and recognized as share-based compensation expense on a straight-line basis over its respective vesting periods. The option agreements provide for accelerated vesting if there is a change in control in ownership.

 

The number of common shares subject to options granted in 2023 for annual board service, board committee service, and continued service of the Chairperson of the Board are 250,000 shares, 78,000 shares, and 400,000 shares, respectively. For annual board service and board committee service, the stock options granted have a contractual period of ten years and vest quarterly over one year. The exercise price per share was based on the average of the high and low share price on the date of grant, or $12.11 per share. The fair value of these grants using the Black-Scholes option-pricing model was $3.88 per share based on an expected term of 5.25 years, expected volatility of 28%, and a risk-free rate of 4.16%. No shares underlying the 2023 stock option grants to directors, other than the Chairperson, remain unvested.

 

For continued board service of the Chairperson, the stock option grant has a contractual period of ten years, of which 133,334 shares vested on June 1, 2024, 133,333 shares vested on June 1, 2025 and 133,333 shares will vest on June 1, 2026. The exercise price per share was based on the average of the high and low share price on the date of grant, or $9.08 per share. The fair value of these grants using the Black-Scholes option-pricing model was $3.94 per share based on an expected term of 6.12 years, expected volatility of 37%, and a risk-free rate of 3.49%. There were 133,333 shares of unvested share options, or $0.4 million of unrecognized compensation cost, at June 30, 2025.

 

An option to purchase 400,000 shares of the Company’s common stock under the Equity Plan was granted to the Chief Executive Officer during the three months ended March 31, 2024. The stock option grant has a contractual period of ten years of which 133,334 shares vested on January 1, 2025, 133,333 shares will vest on January 1, 2026, and 133,333 shares will vest on January 1, 2027. The exercise price per share was based on the average of the high and low share price on the date of grant, or $15.75 per share. The stock option grant is valued at the commitment date, based on the fair value, and recognized as share-based compensation expense on a straight-line basis over its vesting period beginning in January 2024. The fair value of the grant using the Black-Scholes option-pricing model was $6.02 per share at January 1, 2024 based on an expected term of 6.00 years, expected volatility of 31%, and a risk-free rate of 3.82%. There were 266,666 shares of unvested share options, or $1.2 million of unrecognized compensation cost at June 30, 2025.

 

The number of common shares subject to options granted in 2024 for annual board service and board committee service were 312,500 and 87,000, respectively. These option grants have a contractual period of ten years and vest quarterly over one year. The exercise price per share was based on the average of the high and low share price on the date of grant, or $22.25 per share. The fair value of these grants using the Black-Scholes option-pricing model was $8.87 per share based on an expected term of 5.25 years, expected volatility of 32.1%, and a risk-free rate of 4.40%. During the three months ended March 31, 2025, 96,375 shares of stock options granted to directors in 2024 for annual board and committee service vested. No shares underlying the 2024 stock option grants to directors remain unvested.

 

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On August 5, 2024, R. Scot Sellers, a director and Chairperson of the Board, Stephen M. Case, a director, and Race A. Randle, Chief Executive Officer, voluntarily executed agreements to cancel previously granted stock options and common stock grants. The Equity Plan was amended in February 2023 to increase the limit on the number of shares to be awarded during a plan year to 400,000 shares. In 2023, Mr. Sellers received options to purchase 63,500 shares and 18,804 shares of common stock that exceeded the 400,000 share limit. In February 2024, Mr. Randle received 28,511 shares of common stock that exceeded the 400,000 share limit. In addition, although grants to Mr. Case did not exceed the Equity Plan limit, he voluntarily opted to cancel the common stock grants and options issued to him in 2023 amounting to 6,659 shares and 56,000 shares, respectively, and options and restricted shares issued in 2024 amounting to 3,124 shares and 56,000 shares, respectively. The cancellation of the options and common stock grants resulted in recognizing the remaining unvested awards of options and common stock grants immediately. In the third quarter of 2024, $631,000 was recognized as expense due to the cancellations, $402,000 due to the cancellation of Mr. Case’s options and common stock grants and $229,000 due to the cancellation of Mr. Randle’s common stock grants.

 

The simplified method described in Staff Accounting Bulletin No. 107 was used by management due to the lack of historical option exercise behavior. The Company does not currently issue dividends. There were no forfeitures of stock option grants as of June 30, 2025. Management does not anticipate future forfeitures to be material.

 

Share-based compensation expenses totaled $0.7 million and $1.6 million for the three months ended June 30, 2025 and 2024. Included in these amounts were $0.4 million and $0.3 million of restricted common stock vested during the three months ended June 30, 2025 and 2024, respectively, and $0.3 million and $1.3 million of stock options vested during the three months ended June 30, 2025 and 2024, respectively. Share-based compensation expenses totaled $2.3 million and $2.6 million for the six months ended June 30, 2025 and 2024. Included in these amounts were $0.8 million and $0.7 million of restricted common stock vested during the six months ended June 30, 2025 and 2024, respectively, and $1.5 million and $1.9 million of stock options vested during the six months ended June 30, 2025 and 2024, respectively.

 

 

14.	INCOME TAXES

 

The Company uses a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken on a tax return. The Company’s provision for income taxes is calculated using the liability method. Deferred income taxes are provided for all temporary differences between the consolidated financial statements and income tax bases of assets and liabilities using tax rates enacted by law or regulation. A full valuation allowance was established for deferred income tax assets at June 30, 2025, and December 31, 2024, respectively.

 

 

15.	LOSS PER SHARE

 

Basic net earnings (loss) per common share is computed by dividing net earnings (loss) by the weighted-average number of common shares outstanding for the period. Diluted net earnings (loss) per common share is computed similar to basic net loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. Potentially dilutive shares arise from non-vested restricted stock and non-qualified stock options granted under the Equity Plan. The treasury stock method is applied to determine the number of potentially dilutive shares. The potentially dilutive shares were excluded from the computation of diluted weighted average common stock shares outstanding because their effect would have been antidilutive.

 

Basic and diluted weighted-average shares outstanding were 19.7 million and 19.6 million for the six months ended June 30, 2025 and 2024, respectively.

 

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16.	REPORTABLE OPERATING SEGMENTS

 

The Company’s reportable operating segments are comprised of the discrete business units whose operating results are regularly reviewed by the Chief Executive Officer – its chief operating decision maker – in assessing performance and determining the allocation of resources and by the Board. Reportable operating segments are as follows:

 

•

Land development and sales operations consist of land planning and entitlement, development, development related construction, and sales of land assets;

 

•

Leasing, primarily includes revenues and expenses from real property leasing activities, license fees and royalties for the use of certain of the Company’s trademarks and brand names by third parties, and the cost of maintaining the Company’s real estate assets, including watershed conservation activities. The operating segment also includes the management of ditch, reservoir and well systems that provide potable and non-potable water to West and Upcountry Maui areas; and

 

•

Resort amenities, includes a membership program that provides certain benefits and privileges within the Kapalua Resort for its members.

 

The Company’s reportable operating segment results are measured based on operating income (loss), exclusive of interest, pension and other postretirement expenses.

 

		Land Development & Sales				Leasing				Resort Amenities				Other				Consolidated
June 30, 2025
Operating revenues (1)		$	3,442			$	6,421			$	543			$	-			$	10,406
Operating costs and expenses			(3,300	)			(3,367	)			(854	)			-				(7,521	)
Depreciation expense			-				(484	)			(5	)			(52	)			(541	)
General and administrative expenses			(377	)			(503	)			(126	)			(3,829	)			(4,835	)
Operating income (loss)			(235	)			2,067				(442	)			(3,881	)			(2,491	)
Pension and other postretirement expenses																			(7,501	)
Interest expense																			(103	)
Gain on asset disposal																			1
Other income																			455
Income (Loss) from continuing operations																			(9,639	)
Capital expenditures (2)		$	1,671			$	322			$	-			$	111			$	2,104
Assets (3)(4)		$	16,920			$	17,320			$	1,332			$	10,167			$	45,739

 

(1)	Amounts are principally revenues from external customers and exclude equity in earnings of affiliates.

(2)	Includes expenditures for property and deferred costs.

(3)	Segment assets are located in the United States.

(4)	The land development and sales segment includes a $42,000 equity method investment as of June 30, 2025.

 

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		Land Development & Sales				Leasing				Resort Amenities				Other				Consolidated
June 30, 2024
Operating revenues (1)		$	200			$	4,388			$	540			$	-			$	5,128
Operating costs and expenses			(450	)			(2,114	)			(741	)			-				(3,305	)
Depreciation expense			-				(336	)			-				(8	)			(344	)
General and administrative expenses			(327	)			(436	)			(108	)			(3,889	)			(4,760	)
Operating income (loss)			(577	)			1,502				(309	)			(3,897	)			(3,281	)
Pension and other postretirement expenses																			(156	)
Interest expense																			(3	)
Other income																			193
Income (Loss) from continuing operations																			(3,247	)
Capital expenditures (2)		$	911			$	324			$	-			$	-			$	1,235
Assets (3)(4)		$	16,042			$	14,973			$	1,195			$	9,726			$	41,936

 

(1)	Amounts are principally revenues from external customers and exclude equity in earnings of affiliates.

(2)	Includes expenditures for property and deferred costs.

(3)	Segment assets are located in the United States.

(4)	The land development and sales segment includes a $1.6 million equity method investment as of June 30, 2024.

 

 

17.	FAIR VALUE MEASUREMENTS

 

GAAP establishes a framework for measuring fair value and requires certain disclosures about fair value measurements to enable the reader of the unaudited condensed consolidated interim financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. GAAP requires that financial assets and liabilities be classified and disclosed in one of the following three categories:

 

Level 1: Quoted market prices in active markets for identical assets or liabilities.

 

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

 

Level 3: Unobservable inputs that are not corroborated by market data.

 

The Company considers all cash on hand to be unrestricted cash for the purposes of the unaudited condensed consolidated balance sheets and unaudited condensed consolidated statements of cash flows. The fair value of receivables and payables approximate their carrying value due to the short-term nature of the instruments. The method used to determine the valuation of stock options granted to directors during the six months ended June 30, 2025 is described in Note 13 to our consolidated financial statements included in the Annual Report.

 

18.	NEW ACCOUNTING STANDARD ADOPTED

 

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280), which requires public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. We have adopted this guidance, which resulted in modifications to our reportable segment disclosures, which can be found in Note 16 to our consolidated financial statements.

 

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19.	RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

 

The Company's significant accounting policies are described in Note 1 in Item 8 of the Annual Report. During the six months ended June 30, 2025, the Company adopted a new accounting policy related to the Deferred Costs - Agave Venture, see Note 5 to our unaudited condensed interim financial statements.

 

In  December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740), which requires public entities to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction on an annual basis. ASU 2023-09 is effective for fiscal years beginning after  December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2023-09. 

 

In  November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Topic 220), which requires public entities to disclose information about purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion for each income statement line item that contains those expenses. ASU 2024-03 is effective for fiscal years beginning after  December 15, 2026 and interim periods within annual reporting periods beginning after  December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.

 

 

20.	RECLASSIFICATION

 

Certain prior year amounts presented as of December 31, 2024, have been reclassified to conform to the current year presentation. This reclassification had no effect on previously reported results. Deferred development costs reported on the balance sheet have been reclassified to separate Deferred development – development projects from Deferred development – Agave venture.

 

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Item 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion and analysis of our unaudited condensed consolidated interim financial condition and results of operations should be read in conjunction with our annual audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2024 (our “Annual Report") and the unaudited condensed consolidated interim financial statements and related notes included in this Quarterly Report on Form 10-Q (this “Quarterly Report”). The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those expressed or implied by the forward-looking statements below. Factors that could cause or contribute to those differences in our actual results include, but are not limited to, those discussed below and those discussed elsewhere within this Quarterly Report, particularly in the section entitled “Cautionary Note Regarding Forward-Looking Statements.” Depending upon the context, the terms the “Company,” “we,” “our,” and “us,” refer to either Maui Land & Pineapple Company, Inc. alone, or to Maui Land & Pineapple Company, Inc. and its subsidiaries collectively.

 

Overview

 

Maui Land & Pineapple Company, Inc. is a Delaware corporation and the successor to a business organized in 1909 as a Hawai‘i corporation. The Company reincorporated from Hawai‘i to Delaware pursuant to a plan of conversion completed on July 18, 2022. Total authorized capital stock of the Company includes 48,000,000 shares, consisting of 43,000,000 shares of common stock, par value $0.0001 per share, and 5,000,000 shares of preferred stock, par value $0.0001 per share. Shares of the Company’s common stock are listed on the New York Stock Exchange under the ticker symbol “MLP.” The Company consists of a landholding and operating parent company, its principal subsidiary, Kapalua Land Company, Ltd., and certain other subsidiaries

 

We own and manage a diverse portfolio including over 22,000 acres of land on the island of Maui, Hawai‘i along with approximately 247,000 square feet of commercial real estate. For over a century, we have built a legacy of thoughtful stewardship through conservation, agriculture, community building and land management. Our current portfolio of assets includes unimproved land, entitled land allowing for various residential and mixed-use construction, and completed commercial properties.

 

In April 2023, a leadership transition was initiated by appointing a new Chief Executive Officer and new Chairperson of the Board, both of whom are experienced in large scale real estate portfolio management including master planning, community building, and asset management. The strengthening of our team continued with the addition of team members with localized experience including planning, engineering, permitting, community development, land and natural resource stewardship, sustainable agriculture, and asset management.

 

To continue our over 100-year legacy, we are driven by a renewed mission to strategically maximize the use of our assets, resulting in added value to the Company and improved quality of life on Maui for future generations. 

 

As a key initiative of our strategic mission, we have advanced efforts to maximize the productivity of our leasable land and commercial properties. At June 30, 2025, our commercial properties and land were occupied at the following levels, with the net increase (decrease) in leased area as of June 30, 2025, compared to December 31, 2024:

 

Commercial Real Estate		Total				Leased								Net increase (decrease) in leased area (in 2025)
		Sq. ft.				Sq. ft.				Percent				Sq. ft.
Industrial			168,880				150,469				89	%			8,316
Office			10,105				10,105				100	%			-
Retail			61,004				57,111				94	%			799
Residential			7,339				3,000				41	%			-
Total CRE			247,328				220,685				89	%			9,115

 

 

Land		Total				Leased								Net increase (decrease) in leased area (in 2025)
		Acres				Acres				Percent				Acres
Comm./Ind.			19				19				100	%			-
Residential			866				336				39	%			324
Agriculture			10,356				4,653				45	%			-
Conservation			11,045				-				0	%			-
Total CRE			22,286				4,684				21	%			-

 

From January 1, 2025 to June 30, 2025, the team has increased commercial property occupancy from 86% to 89%, including tenant relocations and improvements necessary to enhance the variety and quality of experiences in our town centers.  This effort will continue, along with capital improvements necessary to continue attracting top tier tenants. In addition to stable cashflow in a supply-constrained market, our commercial properties allow us to perform value-creating placemaking for our surrounding landholdings.  We anticipate cashflow from our commercial properties to increase in the coming years, as we reach stabilization and fund the near-term costs for tenant improvements and leasing costs inherent with new tenancies.

 

To enable the productive use of land for homes, businesses, farms, resort projects, or otherwise, we generally must make improvements to the land.  These improvements take the form of master planning, entitlements and zoning, subdivision into useful lot sizes, and the addition of infrastructure, enabling it to be placed into productive use. We continue to progress portfolio-wide strategic plans across over 22,000 acres of landholdings to prioritize and guide actions of the Company in the forthcoming quarters.               

 

 

Our strategic plan for land utilization aligns with our mission to meet the current and future needs of the community, in a significantly supply-constrained market. The plan identified four categories of improved and unimproved land actions as follows in the table below.

 

Category	Region	Property	Approximate Land Area (acres)	Current Land Use/Zoning	Improvements in process	# of Parcels or # of allowable units/lots
1. Improved Land - Remnant and non-strategic parcels planned for sale	West Maui	Five Miscellaneous Non-strategic properties	67	Miscellaneous	Complete	5 parcels
	Upcountry	Three Miscellaneous Non-strategic properties	24	Miscellaneous	Complete	3 parcels
2. Improved Land - Property in active marketing for sale and/or development	Upcountry	Baldwin Ranch Estates Phase 2	31	Agriculture	Sales complete, completing final construction items	2 farm lots
	West Maui	Kapalua Resort - Makai	37	Resort mixed-use	Planning	Existing Entitlements allow for up to 769 residential units, 545 hotel units, and commercial space across both project areas.
	West Maui	Kapalua Resort - Central	46	Resort mixed-use	Planning, Permitting
3. Unimproved Land - Property in active planning and improvements	West Maui	Kapalua Resort - Mauka	927	Resort Residential	Planning, Permitting	Existing Entitlements allow for up to 639 single-family homes or lots
	West Maui	Honokeana Homes – State Temporary Housing	50	Agriculture	Design, permitting	Up to 200 single-family lots
	Upcountry	Hali‘imaile Ranch	325	Agriculture	Subdivision Design	Approximately 24 farm lots
	West Maui	Honokeana Farms	1,501	Agriculture	Planning	Approximately 250 farm lots across both project areas.
	West Maui	Kapalua Ranch	914	Agriculture	Planning
	Upcountry	Hali‘imaile Farms	757	Agriculture	Planning	Approximately 102 farm lots
	West Maui	Kahana Farms	3,046	Agriculture	Planning	Approximately 200 farm lots
	Upcountry	Hali‘imaile Farm Land	348	Agriculture	Planning	TBD
4. Unimproved Land - Property being marketed for long-term lease and ongoing asset management	West Maui	Honolua Farm Land	1,758	Agriculture	Asset management	TBD
	West Maui	Honokohau Farm Land	1,884	Agriculture	Asset management	TBD
	West Maui	Watershed Conservation Land	10,328	Conservation	Asset management	TBD
	West Maui	Waterfront Conservation Land	243	Conservation	Asset management	TBD
	Total Land Portfolio Area (acres)		22,286

 

As a result of this strategic planning effort, our team is underway with concurrent activities to activate our land holdings to meet the long-term needs of the community, including the provision of land for agriculture and housing. 

 

We have recognized revenue from two non-strategic parcel sales in the first six months of 2025 and anticipate additional near-term sales revenues (1-3 years) from other remnant parcels for sale, along with improved land in active marketing for sale and/or development with partner(s). 

 

Unimproved land in active planning and improvements will likely require three or more years before improvements are completed and revenue generation is realized. Funding for soft cost improvements, if not covered by our commercial properties and land leasing cashflow, will likely be provided by remnant non-strategic parcel sales and our revolving line of credit. As infrastructure and site improvement hard costs are warranted, capital will primarily be provided by project presale deposits and construction financing.

 

Planting of agave was initiated in the second quarter of 2025 and the growth cycle of the plants are anticipated to be seven to nine years until achieving maturity for production in food/beverage production. During the course of the agave growth cycle, cash for the venture may be funded with working capital or investment opportunities may be pursued. Revenues will be recognized as the agave, agave byproducts and finished products are sold for manufacturing, distribution or retail sales.

 

 

In connection with the Honokeana Homes project, we have agreed to lease up to 50 acres to the State of Hawai‘i for up to seven years with no lease revenue, to support the needs of victims of the 2023 Lahaina wildfire. The State of Hawai‘i set aside an initial $35.5 million for the project, to fund hard and soft costs related to horizontal improvements on the land. We have agreed to administer the horizontal improvements utilizing third party contractors, on a cost recovery basis with no direct profit from the administrative work.

 

Approximately $3.1 million was spent on behalf of the State of Hawai‘i during the six months ended June 30, 2025 to administer the State of Hawai‘i's improvements on the Honokeana Homes emergency relief project. On other projects, approximately $1,587,000 in development expenditures were made during the six months ended June 30, 2025. Expenditures on the Agave development amounted to $557,000 of the total $1,587,000 spent year to date.

 

Unimproved land identified for long-term lease and ongoing asset management may be expected to be leased or licensed for diversified agricultural, conservation, and cultural uses for the next ten or more years. This land includes the Pu’u Kukui Watershed, which is over 8,600 acres and is actively managed to maximize rainfall capture and recharge of the aquifer which provides approximately 70% of the water consumed in West Maui. 

 

As part of the effort to reactivate dormant croplands that were formerly irrigated, graded and actively farmed, we have initiated a new scalable business venture to cultivate agave. The business aligns with our focus on creating living wage jobs for local families, connecting people to the land, and boosting environmental and economic sustainability. Agave is a drought tolerant, low-maintenance crop attracting a growing global demand for agave-based added-value products. Our strategy complements our ongoing leasing and development projects, and utilizes our prime landholdings to enable revenue upside potential from vertical integration with on-island distillation, regenerative agri-tourism and global distribution. Planting has begun on the agave farm with over 12,000 plants currently in the ground.

 

 

Results of Operations

 

Three and Six Months Ended June 30, 2025 Compared to Three and Six Months Ended June 30, 2024

 

CONSOLIDATED

 

		Three Months Ended June 30,								Six Months Ended June 30,
		(unaudited)								(unaudited)
		2025				2024				2025				2024
		(in thousands)								(in thousands)
Operating revenues		$	4,602			$	2,645			$	10,406			$	5,128
Segment operating costs and expenses			(3,189	)			(1,614	)			(7,521	)			(3,305	)
General and administrative			(1,027	)			(1,118	)			(2,514	)			(2,178	)
Share-based compensation			(742	)			(1,623	)			(2,321	)			(2,582	)
Depreciation			(355	)			(171	)			(541	)			(344	)
Operating loss			(711	)			(1,881	)			(2,491	)			(3,281	)
Gain on asset disposal			-				-				1				-
Other income			349				89				455				193
Pension and other postretirement expenses			(582	)			(78	)			(7,501	)			(156	)
Interest expense			(55	)			(2	)			(103	)			(3	)
Net loss		$	(999	)		$	(1,872	)		$	(9,639	)		$	(3,247	)
Net loss per Common Share - Basic and Diluted		$	(0.05	)		$	(0.10	)		$	(0.49	)		$	(0.16	)

 

 

LAND DEVELOPMENT AND SALES

 

		Three Months Ended June 30,								Six Months Ended June 30,
		(unaudited)								(unaudited)
		2025				2024				2025				2024
		(in thousands)								(in thousands)
Operating revenues		$	1,143			$	200			$	3,442			$	200
Operating costs and expenses			(973	)			(187	)			(3,300	)			(450	)
Operating income (loss)		$	170			$	13			$	142			$	(250	)

 

Land development and sales operating revenues for the three months ended June 30, 2025, consisted of $0.9 million for the Honokeana Homes project revenue and a sale of a non-strategic remnant parcel amounting to $0.2 million, compared to $0 revenue for the Honokeana Homes project and a sale of an easement in the amount of $0.2 million for the three months ended June 30, 2024.  Land development and sales operating revenues in the six months ended June 30, 2025, have primarily consisted of the project revenue from the Honokeana Homes project. There were two sales of real estate during the six months ended June 30, 2025 and one real estate sale during six months ended June 30, 2024. This is purposeful as we continue to evaluate our commercial assets and land holdings to determine the best utilization of our assets in West Maui and in Upcountry Maui in the town of Hali‘imaile to increase value.

 

In December 2021, we entered into an agreement to sell the Kapalua Central Resort project for $40.0 million. On May 13, 2022, terms of the agreement were amended to include a closing condition requiring the Maui Planning Commission to approve an application to extend our Special Management Area (SMA) permit issued by the County of Maui for an additional five years. We allowed the sale agreement to expire on April 11, 2023, however, the Kapalua Central Resort project continues to be marketed for sale or development with partner(s) and the application for the SMA permit extension remains ongoing. The development plans for our real estate holdings remain subject to our ongoing review and evaluation.

 

Land development and sales operating expenses for the three months ended June 30, 2025, were comprised of $0.9 million in Honokeana Homes project direct costs. Approximately $187,000 in development costs were incurred during the three months ended June 30, 2024. Approximately $3.3 million was spent towards real estate development expenditures during the six months ended June 30, 2025 related to the Honokeana Homes project compared to approximately $450,000 that was spent towards real estate development made during the six months ended June 30, 2024. 

 

Land development and sales are cyclical and depend on several factors, such as interest rate impacts on financing and demand. Results from one period are not indicative of future performance trends in this business segment. Prior to the Maui wildfires which occurred on August 8, 2023, there was a shortage of primary housing supply on Maui. While the provision of land to generate primary housing and additional jobs was a priority of ours prior to the wildfires, the loss of over 2,000 homes and over 3,000 jobs in the Maui wildfire accelerated our efforts to get land into productive use to meet these critical needs.

 

LEASING

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		(unaudited)								(unaudited)
		2025				2024				2025				2024
		(in thousands)								(in thousands)
Operating revenues		$	3,203			$	2,173			$	6,421			$	4,388
Operating costs and expenses			(1,973	)			(1,122	)			(3,367	)			(2,114	)
Operating income		$	1,230			$	1,051			$	3,054			$	2,274

 

 

Operating revenues from leasing activities for the three months ended June 30, 2025, were comprised of $2.2 million from commercial, industrial, and agricultural leases, and $1.0 million comprised of $39,000 of licensing fees from our registered trademarks and trade names, approximately $0.8 million from potable and non-potable water system revenues, and $85,000 in grant revenue from the State of Hawai‘i for conservation management of our Pu‘u Kukui Watershed. Operating revenues from leasing activities for the three months ended June 30, 2024, were comprised of $1.7 million from commercial, industrial, and agricultural leases, and the remaining $0.4 million consisted of $36,000 of licensing fees from our registered trademarks and trade names, approximately $0.3 million from potable and non-potable water system revenues, and $85,000 in grant revenue from the State of Hawai‘i for conservation management of our Pu‘u Kukui Watershed.

 

Operating revenues from leasing activities for the six months ended June 30, 2025, were comprised primarily of $4.6 million from commercial, industrial, and agricultural leases, and the remaining $1.8 million was primarily comprised of $72,000 of licensing fees from our registered trademarks and trade names, approximately $1.6 millions from potable and non-potable water system sales and $171,000 in grant revenue from the State of Hawai‘i for conservation management of our Pu‘u Kukui Watershed. Operating revenues from leasing activities for the six months ended June 30, 2024, were comprised primarily of $3.4 million from commercial, industrial, and agricultural leases, and the remaining $0.9 million was primarily comprised of $69,000 of licensing fees from our registered trademarks and trade names, approximately $0.5 millions from potable and non-potable water system sales and $170,000 in grant revenue from the State of Hawai‘i for conservation management of our Pu‘u Kukui Watershed. 

 

 

Certain rental income is contingent upon the sales of tenants exceeding a defined threshold and recognized as a percentage of sales after those thresholds are achieved. As the COVID-19 pandemic waned, visitor traffic to Maui began to increase and these percentage rents, leasing revenues in general and land licensing from adventure tourism tenants were returning to pre-pandemic levels until the occurrence of the devastating Maui wildfires on August 8, 2023. The wildfires directly and critically impacted West Maui and took its toll on percentage rents and revenues for tourism based tenants. The $3.2 million in operating revenues for the three months ended June 30, 2025 compared to the $2.2 million for the three months ended June 30, 2024 and the $6.4 million of operating revenues from leasing activities for the six months ended June 30, 2025, compared to $4.4 million for the six months ended June 30, 2024 is an indication that tourism and visitor traffic is returning to pre-pandemic levels. The increase in operating revenues at June 30, 2025 compared to June 30, 2024, is reflective of our efforts to re-tenant, re-merchandise and convert below market leases to current market rate leases throughout the three commercial centers owned by the Company in the Kapalua Resort, Hali‘imaile Town and the Alaeloa Business Center.

 

The increase in leasing operating costs and expenses for the three and six months ended June 30, 2025, compared to the three and six months ended June 30, 2024, can be attributed to increased leases executed in 2025 resulting in higher property maintenance costs for our commercial leasing portfolio properties, increased property management fees and commissions driven by the increased occupancy of our leasing portfolio, and the costs associated with our efforts to improve the tenant composition in our leasing portfolio.

 

Our leasing operations face substantial competition from other property owners in Maui and Hawai‘i.

 

RESORT AMENITIES AND OTHER

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		(unaudited)								(unaudited)
		2025				2024				2025				2024
		(in thousands)								(in thousands)
Operating revenues		$	256			$	272			$	543			$	540
Operating costs and expenses			(243	)			(305	)			(854	)			(741	)
Operating income (loss)		$	13			$	(33	)		$	(311	)		$	(201	)

 

Our resort amenities and other segments include the operations of the Kapalua Club, a private, non-equity club that provides its members special programs and access and other privileges at certain of the amenities at the Kapalua Resort, including a 30,000 square foot full-service spa and fitness center, a private pool-side dining beach club, and two 18-hole championship golf courses. The Kapalua Club does not own or operate any resort amenities and the member dues collected are primarily used to pay contracted fees to provide access for its members to the spa, beach club and other resort amenities. The Kapalua Club was restructured in 2023. Its revised policies and practices have been implemented to better align club dues and club expenses. The Kapalua Club began to accept new membership applications beginning late 2023.

 

The operating revenues for the three and six months ended June 30, 2025, remained stable compared to the three and six months ended June 30, 2024. There has been a steady intake of new memberships to the Kapalua Club being sold across periods.

 

Operating costs and expenses decreased for the three months ended June 30, 2025, compared to the three months ended June 30, 2024, primarily due to decreased fees for golf true ups due to restructuring of golf privileges made in 2024. Operating costs and expenses increased for the six months ended June 30, 2025, compared to the six month period ended June 30, 2024, due to bad debt write offs incurred in the first quarter of 2025.

 

GENERAL AND ADMINISTRATIVE COSTS, SHARE-BASED COMPENSATION

 

General and administrative costs and share-based compensation for the three months ended June 30, 2025, decreased by approximately $1.0 million, compared to the three months ended June 30, 2024, primarily attributable to a reduction in share-based compensation. General and administrative costs and share-based compensation for the six months ended June 30, 2025 remained consistent at $4.8 million, compared to the six months ended June 30, 2024.

 

Share-based compensation for the six months ended June 30, 2025 amounted to $2.3 million, compared to $2.6 million for the six months ended June 30, 2024. The $0.3 million decrease is attributed to directors stock options that were fully vested at the end of first quarter of 2025. These differences are explained in the paragraphs below.

 

 

An option to purchase 400,000 shares of our common stock under the 2017 Equity and Incentive Award Plan (the Plan) was granted to our Chief Executive Officer during the three months ended March 31, 2024, none of these shares vested during this period. Additional information of the option issuance to the Chief Executive Officer is detailed in Note 13, Share-Based Compensation, to our unaudited condensed consolidated interim financial statements. During the six months ended June 30, 2025, 229,709 shares of underlying stock options vested which were comprised of 96,375 option shares issued to directors in May 2024, 133,334 option shares issued to the Chairperson of the Board in March 2023 and 133,334 option shares issued to the Chief Executive Officer in January 2024. For the six months ended June 30, 2024, director options to purchase 82,000 shares and 243,709 shares vested for annual board and committee service and the Chairman of the Board, respectively.

 

On August 5, 2024, R. Scot Sellers, a director and Chairperson of the Board, Stephen M. Case, a director, and Race A. Randle, Chief Executive Officer, voluntarily executed agreements to cancel previously granted stock options and common stock grants. The Equity Plan was amended in February 2023 to increase the limit on the number of shares to be awarded during a plan year to 400,000 shares. In 2023, Mr. Sellers received options to purchase 63,500 shares and 18,804 shares of common stock that exceeded the 400,000 share limit. In February 2024, Mr. Randle received 28,511 shares of common stock that exceeded the 400,000 share limit. In addition, although grants to Mr. Case did not exceed the Equity Plan limit, he voluntarily opted to cancel the common stock grants and options issued to him in 2023 amounting to 6,659 shares and 56,000 shares, respectively, and options and restricted shares issued in 2024 amounting to 3,124 shares and 56,000 shares, respectively. The cancellation of the options and common stock grants resulted in recognizing the remaining unvested awards of options and common stock grants immediately. In the third quarter of 2024, $631,000 was recognized as expense due to the cancellations, $402,000 due to the cancellation of Mr. Case’s options and common stock grants and $229,000 due to the cancellation of Mr. Randle’s common stock grants.

 

While the Company will continue to use equity as part of its compensation strategy, it does not anticipate using options. We expect a decrease in share-based compensation expenses in the future as a result.

 

OTHER INCOME

 

Other income of $0.5 million and $0.2 million was earned during the six months ended June 30, 2025 and 2024. During the six months ended June 30, 2025 other income was due to interest earned on savings and dividends earned on an investment bond fund of varying maturities and Employe Retention Credit revenue. During the six months ended June 30, 2024, other income was due to interest earned on savings and dividends earned on an investment bond fund of varying maturities. We do not maintain nor possess any off-balance sheet financings nor transactions.

 

LIQUIDITY AND CAPITAL RESOURCES

 

Liquidity

 

Our cash and cash equivalents were $6.5 million and $6.8 million (audited) at June 30, 2025, and December 31, 2024, respectively.

 

We also had investments in a bond fund with varying maturities in the amount of $0.5 million and $2.7 million at June 30, 2025, and December 31, 2024, respectively. Our investments consist of corporate bond securities maturing on various dates through November 2025. These bond investments yield approximately 3.7% at June 30, 2025. We intend to hold our bond securities until maturity.

 

At June 30, 2025, $12.0 million was available from our $15 million revolving line of credit facility (“Credit Facility”) with First Hawaiian Bank (“Bank”), as the Company borrowed $3,000,000 in 2024. The Credit Facility, which matures on December 31, 2025, provides for revolving or term loan borrowing options. Interest on revolving loan borrowings is calculated using the Bank’s prime rate minus 1.125 percentage points. Interest on term loan borrowing is fixed at the Bank’s commercial loan rates with interest rate swap options available. We have pledged approximately 30,000 square feet of commercial leased space in the Kapalua Resort as security for the Credit Facility. Net proceeds from the sale of any collateral are required to be repaid toward outstanding borrowings and will permanently reduce the Credit Facility’s revolving commitment amount. There are no commitment fees on the unused portion of the Credit Facility.

 

The terms of the Credit Facility include various representations, warranties, affirmative, negative and financial covenants and events of default customary for financings of this type. Financial covenants include a minimum liquidity (as defined in the Credit Facility) of $2.0 million, a maximum of $45.0 million in total liabilities, and a limitation on new indebtedness.

 

 

We were in compliance with the covenants of our Credit Facility at June 30, 2025. We may borrow under our credit facility to invest in, and build value in, our assets and fund working capital if economic conditions are negatively impacted in future periods. The Company is currently in discussions with the bank and potential lenders seeking proposals for a credit facility with effective date of December 31, 2025 as the Company's current facility expires on December 30, 2025.

 

Cash Flows

 

Net cash used in operating activities for the six months ended June 30, 2025 was $0.7 million and $0.5 million for the six months ended June 30, 2024.

 

There was land development revenue during the six months ended June 30, 2025 in the amount of $3.4 million primarily related to the Honokeana Homes project and two sales of real estate.  During the six months ended June 30, 2024, there was one sale of real estate.

 

Interest income earned from our money market and bond investments was $0.2 million and $0.2 million for the six months ended June 30, 2025, and 2024, respectively.

 

The outstanding balance of our Credit Facility was $3,000,000 at June 30, 2025. There were no interest payments due on our Credit Facility during the six months ended June 30, 2025.

 

Aggregate contributions in the amount of $1,060,000 were required to be made to our defined benefit pension plan during the six months ended June 30, 2025.

 

Net cash provided by investing activities for the six months ended June 30, 2025, was $0.7 million compared to $1.3 million used during the six months ended June 30, 2024. The increase in cash provided can be attributed to $2.2 million in maturities of debt securities, with no purchases of new debt securities during the six months ended June 30, 2025. The increase was offset by $2.1 million in payments for property and deferred development costs during the six months ended June 30, 2025, compared to $1.2 million spend on similar costs during the six months ended June 30, 2024.

 

Net cash used in financing activities for the six months ended June 30, 2025, was $0.3 million compared to $78,000 for the six months ended June 20, 2024, and can primarily be attributed to payments on long term debt.

 

Capital Resources

 

Our business initiatives include investing in our operating infrastructure and continued planning and entitlement efforts on our development projects. At times, this may require borrowing under our Credit Facility or other indebtedness, repayment of which may be dependent on selling of our real estate assets at acceptable prices in condensed timeframes. We may also elect to raise additional capital through the sale of equity, from time to time. We believe our cash and investment balances, cash provided from ongoing operating activities, and available borrowings under our Credit Facility, will provide sufficient liquidity to enable us to meet our working capital requirements, contractual obligations, and timely service our debt obligations for the next twelve months and the foreseeable longer term. 

 

Our indebtedness could have the effect of, among other things, increasing our exposure to general adverse economic and industry conditions, limiting our flexibility in planning for, or reacting to, changes in our business and industry, and limiting our ability to borrow additional funds

 

Critical Accounting Policies and Estimates

 

The preparation of the unaudited condensed consolidated interim financial statements in conformity with GAAP requires the use of accounting estimates. Changes in these estimates and assumptions are considered reasonably possible and may have a material effect on the unaudited condensed consolidated interim financial statements and thus actual results could differ from the amounts reported and disclosed herein. For additional information regarding our critical accounting policies, see the section titled Critical Accounting Policies and Estimates in Part II, Item 7, within our Annual Report. There have been no material changes to the critical accounting policies and key estimates and assumptions disclosed in our Annual Report.

 

Item 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

We have no material exposure to changes in interest rates related to our borrowing and investing activities used to maintain liquidity and to fund business operations. We have no material exposure to foreign currency risks.

 

 

Item 4.

CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

 

In designing and evaluating the disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

 

As required by Rules 13a-15(b) and 15d-15(b) under the Exchange Act, we carried out an evaluation, under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures at the end of the fiscal quarter covered by this report. Based upon the foregoing, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures were effective as of June 30, 2025 to provide reasonable assurance that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in applicable SEC rules and forms.

 

Changes in Internal Controls Over Financial Reporting

 

There have been no significant changes in our internal controls over financial reporting (as such term is defined in Exchange Act Rule 13a-15(f) or 15d-15(f)) during the three months ended June 30, 2025 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

 

PART II OTHER INFORMATION

 

Item 1.

LEGAL PROCEEDINGS

 

For information related to Item 1. Legal Proceedings, refer to Note 11, Commitments and Contingencies, to our unaudited condensed consolidated interim financial statements included herein.

 

Item 1A.

RISK FACTORS

 

Potential risks and uncertainties include, among other things, those factors discussed in the sections entitled “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report and the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report. Readers should carefully review those risks and the risks and uncertainties disclosed in other documents we file from time to time with the SEC. We undertake no obligation to publicly release the results of any revisions to any forward-looking statements to reflect anticipated or unanticipated events or circumstances occurring after the date of such statements. During the six months ended June 30, 2025, there were no material changes to the risks and uncertainties described in Part I, Item 1A., “Risk Factors,” of our Annual Report.

 

Item 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

Recent Sales of Unregistered Securities

 

None.

 

Repurchase of Equity Securities

 

No equity securities were repurchased during the three months ended June 30, 2025.

 

 

Item 3.

DEFAULTS UPON SENIOR SECURITIES

 

None.

 

Item 4

MINE SAFETY DISCLOSURES

 

None.

 

Item 5

OTHER INFORMATION

 

The Company's directors and officers (as defined in Rule 4 16a-1 under the Exchange Act) may enter into trading plans or other arrangements with financial institutions to purchase or sell shares of the Company's common stock. These plans or arrangements may be intended to comply with the affirmative defense provisions of Rule 10b5-1 of the Exchange Act, which are referred to as Rule 10b5-1 trading arrangements, or they may represent non-Rule 10b5-1 trading arrangements.

 

During the six months ended June 30, 2025, none of our directors or officers adopted, modified or terminated Rule 10b5-1 trading arrangement or "non-Rule 10b5-1 trading arrangement" as those terms are defined in Item 408 of Regulation S-K)

 

 

 

Item 6.	EXHIBITS
31.1*	Certification of Principal Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, as amended.
31.2*	Certification of Principal Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, as amended.
32.1**	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended.
32.2**	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended.
101.INS*	Inline XBRL Instance Document
101.SCH*	Inline XBRL Taxonomy Extension Schema Document
101.CAL*	Inline XBRL Taxonomy Extension Calculation Document
101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB*	Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*	Inline XBRL Taxonomy Extension Presentation Link Document
104*	Cover Page In Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*	Filed herewith
**	The certifications attached as Exhibit 32.1 and 32.2 accompany this Quarterly Report on Form 10-Q pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, shall not be deemed “filed” by the registrant for purposes of Section 18 of the Exchange Act, and shall not be incorporated by reference into any of the registrant’s filings under the Securities Act or the Exchange Act, whether made before or after the date of this Quarterly Report, irrespective of any general incorporation language contained in any such filing.

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

		MAUI LAND & PINEAPPLE COMPANY, INC.
August 14, 2025		/s/ WADE K. KODAMA
Date		Wade K. Kodama
		Chief Financial Officer
		(Principal Financial Officer, Principal Accounting Officer)