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page 1
Landscapes certainly look different when viewed from above.
A view from 30,000 feet can give you perspective and the
big picture, but you can miss the individual details that,
together, give character and identity to what you’re viewing.
The same thing can be true of a company.
Often in our quest to see the big picture, we miss the individual
components that make up a company – like its employees.
We never want that to be the case at Tejon Ranch Company.
We believe the strength of our Company comes from talented
individual employees who work together to achieve what is best
for the Company, its shareholders – and for California – as
we pursue our vision to “Preserve California’s Legacy” and
“Provide for California’s Future.”
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To our valued shareholders:
In 2007, I celebrated my 11th anniversary at
today – not because it’s been untouched –
Tejon Ranch. As I look back at where we
but because we’ve purposefully taken good
were eleven years ago and where the Company
care of the land.
is today, the differences are striking. We’ve
transitioned Tejon Ranch Co. from primarily
The Ranch Vision calls for more acreage to
a ranching and agricultural operation to
be devoted to conservation and preservation
a diversified real estate development and
than for any other purpose. We believe this is
agribusiness company. In the process, we have
good for the land and for our shareholders.
developed and articulated a long term vision
Conservation land certainly possesses its
to guide the Company as it moves forward.
own intrinsic value. But even if the land
The guiding principles behind the Tejon
was never part of a transaction, experience
Ranch Vision are the Ranch’s historic core
teaches that significant conservation areas
values of conservation and good stewardship.
often greatly increase the value of the lands
The Vision identifi es those values and activities
surrounding them.
we believe to be important and defi nes our areas
of concentration for the next 25 to 30 years.
Not only does this commitment to
conservation involve our land, it also extends
First, the Tejon Ranch Vision outlines our
to the wildlife on the Ranch. We continue to
long-standing commitment to conservation.
work with the U.S. Fish and Wildlife Service
Tejon Ranch has often been described as
on plans to conserve habitat for endangered
a “jewel,” an unspoiled natural landscape
species, including the California condor. Last
of great beauty. Such a description not
year we announced a ban on the use of lead
only reflects Tejon’s God-given physical
ammunition on the Ranch, an action hailed by
attributes, but serves as testimony to our good
condor experts as the most important step we
stewardship. Tejon Ranch has experienced a
could take to enhance the condor’s recovery.
great deal of physical activity over the years,
including the building of the California
Tejon Ranch is authentic California and
Aqueduct as well as construction of a number
our Vision calls for us to continue with the
of utility easements that cross the Ranch. The
historic activities that have taken place on
truth is Tejon Ranch is in the condition it’s in
the Ranch over the years. Ranching, farming
Tejon Ranch is located approximately 60 miles north of
Los Angeles and 30 miles south of Bakersfi eld. At nearly
270,000 acres, it’s the largest contiguous piece of private
property in California.
and hunting are the epitome of what it
means to “Preserve California’s Legacy”
and “Provide for California’s Future.” Our
ranching and farming operations not only
preserve an important legacy on the Ranch,
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they also provide food for California and
Last year was certainly not a banner year
the rest of the world. This land was hunted
for the residential real estate market and
long before the first European ever set foot
experts are divided as to when we might see
on the territory they named “Tejon,” and
a significant recovery. But while the current
our renowned wildlife management operation
down cycle could potentially impact the
is helping maintain the healthiest and
timing of the commencement of construction
most diverse wildlife population you’ll find
of Centennial and/or Tejon Mountain
in California.
Village, it will have no impact on the size,
scope and scale of the overall plan. Both
The Tejon Ranch Vision also calls for using
communities will be built in phases over
a small portion of the Ranch to build high
a 15 to 25 year time frame and could
quality, environmentally sensitive communities.
experience several real estate cycles during
Together with our partners in our planned
their build out periods.
residential communities of Centennial and
Tejon Mountain Village, we are working
We saw good progress last year at Tejon
diligently to finish the Environmental Impact
Industrial Complex (TIC). In April, the
Reports (EIR) for those two communities.
5th District Court of Appeals affirmed a
Largely due to court decisions and other legal
lower court ruling allowing the expansion
actions, the process of complying with the
of TIC to the east side of Interstate 5. This
California Environmental Quality Act has
important victory clears the way for us to
become increasingly complex and costly.
commence with construction on the east side
Changes in standards and regulations often
of the freeway, beginning with a new travel
require changes to EIRs. For example,
center. That construction, along with other
the EIRs for both Centennial and Tejon
infrastructure work needed to prepare the
Mountain Village will now have sections
site for additional commercial and industrial
devoted to an analysis of greenhouse gas
offerings, is expected to begin later this year.
emissions. Twelve months ago that would
The Company realized a significant gain last
not have been necessary.
year when the Tejon-Dermody warehouse was
sold to ProLogis. Our 50% interest in the
building generated $8.7 million in before-
tax income. We also added more commercial
offerings at TIC last year, including a new
In-N-Out Burger. On the industrial side, a
606,000-square-foot building begun in 2007
in conjunction with our partnership with
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Rockefeller Group Development Corporation
We are very proud of our people. They are
is now complete. IKEA is currently occupying
smart and dedicated and work well together.
much of the building on a month-to-month
That’s important because teams play a vital
basis while we pursue a permanent tenant.
role at Tejon Ranch. They allow us to combine
Our partnership with The Rockefeller Group
the expertise and experience of individuals
is also planning to begin construction this
from different and diverse departments and
year on a separate, slightly smaller facility at TIC.
bring them together to accomplish a common
goal. We recognize, as did Ken Blanchard, that
We recognize that what we’ve already
“none of us is smarter than all of us.”
accomplished, and what we hope to achieve
in the years to come, doesn’t happen alone.
All Tejon Ranch employees are highly qualified
It takes the combined efforts of our
and are critical to our success as a company.
employees and our partners. In last year’s
Our intention, in shining the spotlight on
annual report, we looked outward at the
just a few, is not to infer that some are more
strategic partnerships we’ve formed to help
important than others. Rather, we present
us carry out our business plan. This year
them as examples of how we use teams from
we’d like to focus our attention inward and
different departments and divisions to
highlight some of the many internal cross-
move the company forward. The ones we are
departmental teams who are working to help
highlighting in this year’s annual report, our
us realize the Tejon Ranch Vision.
Conservation, Water and Real Estate teams,
are simply representative of many others that
exist throughout the organization. All our
teams share the same goal – to execute the
Tejon Ranch Vision and build shareholder
value. Thank you for your confidence as we
move ahead, together, in that pursuit.
Robert A. Stine
President & CEO
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CONSERVATION TEAM
Conservation and good stewardship are fundamental principles
at Tejon Ranch, identified in the Company’s mission statement as core values
that guide and influence everything we do. We believe we have a responsibility
to continue that legacy of good stewardship that pre-dates the establishment of
Tejon Ranch in 1843 and its subsequent purchase by General Edward Fitzgerald
Beale a decade or so later. From the native Americans who first inhabited the
land, to the Beales, to the Chandlers, to today, Tejon Ranch recognizes that the
beauty and integrity of the land is the Ranch’s single greatest asset.
Good stewardship is not something that happens by itself. The very concept
of stewardship involves active management. That certainly has been the history
at the Ranch. From grazing and farming practices, to wildlife management,
to limiting access, Tejon Ranch’s stewardship of the land has been planned,
intentional and successful. That’s quite an accomplishment considering we are
dealing with an area larger than the city limits of Los Angeles. The Ranch is in
the condition it’s in today because it’s been actively cared for, evidence of our
fundamental core values of conservation and good stewardship.
It requires a variety of disciplines to ensure Tejon Ranch is properly cared for.
That’s why the Ranch’s Conservation team is made up of members from a
number of different departments. Some, like those from our Ranch Operations
department, are responsible for the maintenance and monitoring of the
physical condition of the Ranch. Others, from our Real Estate Planning and
Entitlements department, for example, are involved in future conservation
planning and interfacing with various resource agencies and groups. Our
Geographic Information Systems department provides vital information critical
to both the on going stewardship of the Ranch as well as future planning efforts.
While these are just a few of the departments that play active roles in the
conservation and stewardship of the Ranch, we’d like to highlight representatives
from these respective departments as we introduce you to members of Tejon
Ranch’s Conservation team.
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Donald N. Geivet
Dennis Atkinson
Vi c e P r e s i d e n t o f R a n ch O p e r a t i o n s
biog raphy: Don Geivet’s tenure at Tejon Ranch is
among the longest of any of our employees. He’s been
a part of the Ranch for more than 35 years, beginning
his career in 1972 as assistant manager of the Livestock
division. In 1982 he was promoted to Manager of the
Game Management/Special Services division and in
2005 was named Vice President of Ranch Operations.
Don received his bachelor of science degree from
Cal Poly San Luis Obispo. Over the past ten years
he has been elected and served on the California and
National Board of Directors for the National Wild
Turkey Federation, and is a current member of several
wildlife conservation organizations, including the Rocky
Mountain Elk Foundation, Mule Deer Foundation
and the Safari Club International. In 1998 he was
presented with the Al Taucher Hunting Heritage Award
in recognition of his outstanding contributions to the
promotion of California’s rich hunting heritage.
re spo ns ibilit es: As Vice President of Ranch
Operations, Don is primarily responsible for overseeing
the use and condition of the Ranch’s rangeland, and
the flora and fauna that inhabit it. This includes the
maintenance of all roads, water systems, fences and
livestock and hunting facilities. Additionally, Don is
responsible for the Wildlife Management division and
works to ensure that the wildlife population on the
Ranch stays healthy and in balance. As a member of the
Conservation team, the Ranch Operations division works
diligently to make sure that all ranch resources are used
responsibly in order to create the maximum attainable
value of the resources for future conservative uses.
CONSERVATION TEAM
“We conserve the things we value,
and the condition of Tejon Ranch
today is testament to the high regard
we have always had for our land.”
—Donald N. Geivet
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E. Andrew Daymude
De nn is Atk in son
Vi c e P r e s i d e n t ,
P l a n n i n g a n d E n t i t l e m e n t s
biog raphy: Andrew Daymude joined Tejon Ranch
nearly a decade ago. Andrew is a graduate of the
University of Georgia School of Environmental Design
where he earned a Bachelor of Landscape Architecture
and Environmental Design. He is a registered landscape
architect and is a member of the American Society of
Landscape Architects, the American Planning Association,
and a Regent of the California Architectural Foundation.
Andrew has practiced in Hawaii and California, and
has been blessed with many opportunities to touch
majestic landscapes.
responsibilities: As an “architect of the land,” his mission
is to be mindful of the creator’s original handiwork
and to comprehend all the natural, biological, scientifi c,
economic, and political infl uences on any palette he
encounters. With that mission in mind, Andrew is
responsible for the environmental analysis and long range
land planning for the Ranch. He coordinates the various
conservation and community initiatives to ensure that the
Tejon Ranch Vision is realized. He leads our team in the
planning, design, and regulatory compliance related to
future conservation areas, including Biological Mitigation
Banks and Habitat Conservation Plans. He is the primary
point of contact for various resource agencies, including
the U.S. Fish and Wildlife Service and the California
Department of Fish and Game. He is also working with
the U.S. Forest Service and Pacifi c Crest Trail Association
to realign a 37-mile portion of the 2,650-mile Pacifi c Crest
Trail from its current location on the Antelope Valley
fl oor to the picturesque highlands of the Ranch.
CONSERVATION TEAM
“Our Vision is simple, yet rich and complex.
It continues our legacy of stewardship, our
rich agricultural and ranching heritage, our
commitment to supplying employment and
housing opportunities to meet the imminent
demands of California, all the while preserving
the very best portions of the Ranch.”
—E. Andrew Daymude
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Leah D. Metzger
D i r e c t o r o f G e o g r a p h i c
I n f o r m a t i o n S y s t e m s
biog raphy: Leah Metzger has directed Tejon Ranch’s
GIS department since 1999. Geographic Information
Systems (GIS) are computer-based methods of recording,
analyzing, combining, and displaying geographic
information such as ownership, property boundary, tax
parcels, roadways, hydrology, habitat types, soil and
geology types, or any other feature that can be mapped on
the ground. Leah joined Tejon following six years as GIS
Coordinator for Paramount Farming Company. She also
assisted in the coordination and implementation of the
geographic information management system developed
during the design and construction phase of the Kern
Water Bank Authority’s 25,000-acre groundwater recharge
facility. Leah has served on a number of professional
organizations, including terms as president and vice
president of the Central California Chapter of the Urban
and Regional Information Systems Association (URISA).
re spo nsi bilities: As Director of the GIS department,
Leah’s primary role as part of the Conservation team is to
manage and provide information related to the databases
of numerous elements, such as wildlife movement
corridors, wildlife habitat, vegetative communities,
terrain, multi-specie flora and fauna, archeological surveys
and water resources, to name a few. This is especially
useful in management planning and land-use decisions,
enabling members of the team to record physical
conditions on the ground and track their change over
time. GIS is a valuable tool which provides Tejon Ranch
the ability to analyze and understand the geographical
relationship between various resources, whether physical
or geo-political, allowing management to make informed
decisions regarding conservation policy and its impact to
the Ranch.
CONSERVATION TEAM
“Working as a team in our conservation
planning efforts, we are helping Tejon Ranch
make the best possible decisions for the
Company, its land, and the environment.”
—Leah D. Metzger
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Water Team
Water is the new gold of the 21st Century, especially in California. Its
continued availability is crucial for California homeowners, businesses,
industries and agriculture. Tejon Ranch is no exception. Having a long-term
reliable source and supply of water is critical to the Ranch’s future.
Fortunately, through a combination of location, geography, geology, and good
planning, the Ranch is in an excellent position when it comes to water. Springs
and creeks dot our nearly 270,000 acres. The California Aqueduct channels
through the middle of the Ranch and we have long held rights to water from
the State Water Project. Underground aquifers on the Ranch have proven ideal
for water banking. Last year we stored nearly 6,600 acre feet of water in our
newly established Tejon Ranch Water Bank, which is located in the Antelope
Valley portion of the Ranch near Centennial. Several other areas of the Ranch
may also be conducive to water banking.
We certainly don’t take our strong position for granted. We operate under the
philosophy that one can never have enough water. Our Water team is responsible
for securing, storing and supplying sufficient water resources to meet the needs of
our ranching, farming and real estate operations. From negotiating the purchase
of water supplies from outside interests and agencies, to managing the storage
and distribution of water throughout the Ranch, as well as maintaining water
systems, perfecting water rights and ensuring regulatory compliance, our Water
team plays a vital role in both the day-to-day and future operations of the Ranch.
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Dennis Atkinson
De nn is J. At kinson
Vi c e P r e s i d e n t o f A g r i c u l t u r e
biog raphy: Dennis Atkinson has been employed
by Tejon Ranch for more than 30 years. A graduate
of Cal Poly San Luis Obispo, he is actively involved
in agricultural organizations statewide. He is a past
regional director of the State Farm Bureau, past
president of the Kern County Farm Bureau, sits on the
boards of the Glassy Wing Sharpshooter Board, the
Kern Ag Foundation, and is on an advisory board for
the University of California, Riverside. Dennis is also
involved in a number of water agencies. He’s president
of the Tejon Castac Water Agency, vice president of the
Wheeler Ridge Water Agency and is a member of the
Kern County Water Bank Authority board of directors.
responsibilities: As head of Tejon Ranch Company’s
agricultural operations, Dennis is responsible for
all water related issues in our farming division. But
with more than three decades at the Ranch, and three
decades dealing with water policy, Dennis brings to
the Water team a wealth of knowledge and experience
regarding local, regional and statewide water matters. He
understands the acquisition and distribution of water
resources, and importantly, the relationships between
various water agencies in California. He knows the big
picture, the process and the players.
“Providing for California’s Future is something
we take very seriously. The Ranch has always been
forward thinking, willing to take a long range
view, looking ahead 30 to 40 years. We’ve found
that what is good for California’s future is also
good for the future of the Company.”
—Dennis J. Atkinson
Water Team
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Babalola A. Makinde-Odusola
D i r e c t o r o f Wa t e r R e s o u r c e s
biog raphy: Babs Makinde joined Tejon Ranch in the
summer of 2007 from the City of Riverside, where he
was a Senior Engineer in its Public Utilities Department.
He is a licensed Civil Engineer and a Diplomate,
American Academy of Water Resource Engineers. Babs’
water management experience in California has been at
both the local and state levels, and he’s experienced in
negotiating and protecting water rights and providing a
long-term strategic vision for infrastructure. Babs is a
member of the American Water Works Association and
the National Groundwater Association.
responsibilities: With a background in both urban
and rural water management, Babs’ role on the Water
team is to provide professional engineering expertise
regarding the Ranch’s various water issues. He oversees
operation of the Tejon Ranch Water Bank and serves as
the point of contact for the Ranch’s involvement with
state and local water agencies, including the California
Department of Water Resources and the Tejon Castac
Water District.
“Tejon Ranch is more than just a ranch.
It’s the most important link between southern
and northern California for water, energy,
communications and other vital infrastructure.”
—Babalola A. Makinde-Odusola
Water Team
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Dennis Atkinson
Te r i A . Bjor n
Vi c e P r e s i d e n t & G e n e r a l C o u n s e l
biog raphy: Teri A. Bjorn has been Tejon Ranch
Company’s General Counsel since January 2007. She
brings to the position nearly 30 years of legal experience,
with a specialization in transactional real estate and land
use law. Her background and experience have given her
a keen understanding of the essential component of
water for any beneficial use on the land, from farming
to real estate development. Teri earned both bachelor’s
and master’s degrees in French language and literature
from the University of Iowa and received her law degree
from George Washington University in Washington, DC.
Teri is a member of the American Bar Association, the
California and Oregon Bar Associations, the Kern
County Bar Association, and the Kern County Women
Lawyers Association.
responsibilities: As the attorney member of the
Water team at Tejon Ranch, Teri oversees the legal
assessment of the Ranch’s water supplies and needs for
existing and planned activities, including the negotiation
and closing of water asset purchases, and the protection
of those assets. In addition to providing legal guidance
on water issues, she also contributes business and
government relations advice in an arena that’s becoming
more and more politicized.
“Combining the knowledge, experience and
expertise of a land attorney, and
agricultural and urban water experts, Tejon
Ranch’s Water team is ensuring that the best
decisions are being made for the Company,
and for the water community as a whole.”
—Teri A. Bjor n
Water Team
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Real Estate Team
Tejon Ranch’s Vision for the future calls for the use of a
small portion of our land to create high-quality, environmentally sensitive
communities. Each community that’s part of the plan is different, but together,
they provide great variety and meet a broad range of needs while providing a
wealth of opportunities. The industrial/commercial nature of Tejon Industrial
Complex is geared toward job creation. Centennial’s wide mix of housing and
employment opportunities will address the huge and persistent shortage of
housing in Southern California while providing people an opportunity to work
close to home. Tejon Mountain Village promises to be a world class destination
and will set new standards for developing environmentally sensitive communities
in beautiful natural areas. The Ranch’s real estate efforts will not only provide
homes, jobs, recreational and economic opportunities for current and future
generations of Californians, they will also help build value in the Company.
The challenge for our Real Estate team is to execute that Vision. Even though
that effort may be challenging, our team is certainly up to the task. Each of the
communities are different in size, scale and approach; and are also at different
points in the development process. Two of them – Centennial and Tejon
Mountain Village – are in the fi nal planning and environmental review stage. At
Tejon Industrial Complex, we’re actively marketing and building. Centennial and
Tejon Mountain Village are being developed solely through partnerships. Tejon
Industrial Complex includes a mix of partnerships, direct land sales and leases.
All of this diversity requires our Real Estate team to possess a wide variety of
skill sets, expertise and experience. Team members may be involved in planning
or participating in the political process. Some are making deals or are making
sure that the deals make sense fi nancially. Others are overseeing construction,
ensuring that everything is built to Tejon Ranch standards. Working together,
we’re moving forward.
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Kathleen J. Perkinson
Vi c e P r e s i d e n t o f C o m m u n i t y
D e v e l o p m e n t
biog raphy: Kathy Perkinson joined Tejon Ranch
in July 2007, bringing with her more than 20 years
experience in the planning and development of master
planned communities in California and Texas. She
previously served as Managing Director for the Miller
Family Companies, the master developer of Dos Vientos
Ranch in Thousand Oaks, California; as General
Manager of Wood Ranch in Simi Valley, California and
Vice President Finance for Richland Interests, a Hines
affiliate; and as Vice President and Senior Controller
of Sugarland Properties Incorporated, the developer
of First Colony in Sugar Land, Texas. Kathy earned her
BS in Accountancy from the University of Illinois and
is a Certified Public Accountant. She is a member of a
number of professional organizations and is Chair of the
Urban Land Institute Community Development Council.
re spo nsi bilities: Centennial and Tejon Mountain
Village are being developed in partnership with several
major home building and real estate development
companies. As such, it is important for Tejon Ranch
to have someone serve as its primary representative in
these partnerships, bringing leadership and experience
to the project teams while also representing the
Company’s interests. Kathy Perkinson has that important
responsibility. The primary goal behind Centennial
and Tejon Mountain Village is to develop high-quality,
environmentally sensitive communities that will meet
the housing, employment and lifestyle needs of
Californians, while providing significant economic
returns to the Company and its shareholders. From the
planning and entitlement process, all the way through
construction, sales and marketing, it is Kathy’s job to see
this goal accomplished.
Real Estate Team
“It is exciting to contribute to the leadership of an
organization whose core values exemplify responsible
land planning by providing opportunities for current and
future generations to live, work and recreate amid the
natural beauty and heritage of Tejon Ranch.”
—Kathleen J. Perkinson
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page 31
Bar ry G . Hibbard
Vi c e P r e s i d e n t o f C o m m e r c i a l
& I n d u s t r i a l D e v e l o p m e n t
biog raphy: Now starting his tenth year at Tejon Ranch
Company, Barry Hibbard oversees the development,
sales and leasing for the 1,450-acre Tejon Industrial
Complex (TIC). During that time he has sold, leased
or developed 208 acres with 2.9 million square feet of
industrial properties, and 87,000 square feet of freeway
commercial/retail properties. Barry is a graduate of
Michigan State University, where he earned a bachelor
of science in finance, and California State University,
Bakersfield, where he earned an MBA. He is an active
member of National Association of Industrial and
Office Properties (NAIOP) and the Council of Supply
Chain Management Professionals (CSCMP).
re spo ns ibilit ies: While Centennial and Tejon
Mountain Village are in their final planning stages, Tejon
Industrial Complex is entitled and growing. Leading
TIC’s marketing and development effort makes Barry
the Company’s primary sales person. He is responsible
for determining how our commercial and industrial land
can meet the needs of a growing California; identifying
market opportunities; developing the product; telling the
world that the product is available; and attracting world
class companies to TIC, thereby creating core jobs in the
community. Barry also interfaces with our two partners
at TIC; Rockefeller Group Development Corporation
and TA/Petro. As the Company’s first entitled
development, TIC is projecting Tejon Ranch Company’s
values of quality, stewardship and vision, to the local,
state and national real estate communities.
Real Estate Team
“I see a unique, quiet confi dence and
excitement in everyone working for Tejon
Ranch. We are privileged to be a
part of history and to be working for a
purpose much larger than ourselves.”
—Bar ry G. Hibbard
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page 33
H ugh F. McMahon IV
Vi c e P r e s i d e n t o f F i n a n c e
De nn is Atk in son
biog raphy: Hugh McMahon began his career with
Tejon Ranch Company in 2001. Prior to joining
the Ranch, he was Director of Finance for Castle
and Cooke’s mainland operations headquartered in
Bakersfield, California. Hugh graduated with a bachelor
of arts in economics from California State University,
Fresno, and received an MBA from California State
University, Bakersfield. He is also a graduate of Stanford
University’s Financial Management Program, and
Harvard University’s Real Estate Management Program.
re spo ns ibilit ies: Hugh’s role on the Real Estate
team is to engage in a relentless pursuit of value for the
Company. His primary area of responsibility is to engage
in the necessary financial analysis, project costing, and
valuation modeling to make sure our real estate deals and
developments make financial sense – for the Company
and for shareholders. Hugh also works with our business
partners to analyze deal structures and with lending
institutions to obtain bank financing. Tejon Ranch is the
largest contiguous piece of private property in California
and as such, it contains a myriad of land leases, facility
leases, and strategic easements for various uses, including
commercial and industrial real estate, power generation
and transmission, telecommunications, and oil and
mineral extraction. Managing this diverse portfolio of
leases is also Hugh’s responsibility.
Real Estate Team
“I am a developer by trade and a naturalist by
heart. These two disciplines are not mutually
exclusive, and must come together if we are to
address the challenges posed by California’s growing
population while minimizing the impact of
that growth. I am proud to work for a company
whose vision is guided by this principle.”
—Hugh F. McMahon IV
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page 3 5
Fina n cia l Review Su mmary
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page 37
Consolidated Balance Sheets
Consolidated Statements of Operations
($ in thousands)
ASSETS
Current assets:
Cash and cash equivalents
Marketable securities
Accounts receivable
Inventories
Prepaid expenses and other current assets
Total current assets
Property and equipment, net
Investments in unconsolidated joint ventures
Other assets
Total assets
LIABIL ITIES AND S TOCKH OL DER S’ EQ UITY
Current liabilities:
Trade accounts payable
Other accrued liabilities
Deferred income
Income taxes payable
Current portion of long-term debt
Total current liabilities
Long-term debt, less current portion
Long-term deferred gains
Other liabilities
Pension liability
Stockholders’ equity
Common stock, $.50 par value per share:
Authorized shares - 30,000,000
Issued and outstanding shares - 16,899,982 in 2007 and 16,776,049 in 2006
Additional paid-in capital
Accumulated other comprehensive loss
Retained earnings
Total stockholders’ equity
Total liabilities and stockholders’ equity
2007
December 31
2006
$
$
$
9,454
67,559
9,352
4,129
9,059
99,553
50,357
24,464
1,129
175,503
1,511
656
572
1,359
28
4,126
389
1,688
2,954
1,292
8,450
118,370
(2,071)
40,305
165,054
175,503
$
$ 4,662
73,404
7,835
2,578
7,481
95,960
$
$
45,657
16,628
872
159,117
1,553
658
1,309
-
27
3,547
417
1,688
2,656
1,779
8,388
110,558
(2,888)
32,972
149,0301
159,117
$
($ in thousands, except per share amounts)
REVENUES
Real estate - commercial/industrial
Farming
Total revenues
Costs and expenses:
Real estate - commercial/industrial
Real estate - resort/residential
Farming
Corporate expenses
Total expenses
Operating loss
OTHER INCOME (EXPENSE)
Investment income
Other
Interest expense
Total other income
Income (loss) from continuing operations before
equity in earnings of unconsolidated joint ventures
Equity in earnings of unconsolidated joint ventures, net
Income (loss) from operations before income
tax provision (benefi t)
Income tax provision (benefi t)
Net income (loss)
Net income (loss) per share, basic
Net income (loss) per share, diluted
2007
16940
$
15,404
32,344
12,427
3,512
10,432
8,547
34,918
(2,574)
3,509
55
(70)
3,494
920
10,580
11,500
4,167
$
$
$
7,333
0.43
0.42
Year Ended December 31
2005
2006
$
16,010
12,412
28,422
$
13,063
13,297
26,360
11,231
3,408
9,324
13,173
37,136
(8,714)
2,975
119
(70)
3,024
(5,690)
1,247
(4,443)
(1,714)
$ (2,729)
$
$
(0.16)
(0.16)
9,271
2,496
7,514
7,881
27,162
(802)
2,565
384
(70)
2,879
2,077
423
2,500
954
1,546
0.09
0.09
$
$
$
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page 39
Consolidated Statements of Stockholders’ Equity
Consolidated Statements of Cash Flows
($ in thousands, except shares outstanding)
Balance, December 31, 2004
Net income
Changes in unrealized losses on
available-for-sale securities,
net of taxes of $553
Benefi t plan adjustments,
net of taxes of $497
Equity in other comprehensive income
of unconsolidated joint venture,
net of taxes of $61
Comprehensive income
Additional cost related to private
placement
Exercise of stock options and
related tax benefi t of $989
Restricted stock issuance
Stock compensation
Balance, December 31,2005
Net income (loss)
Changes in unrealized losses on
available-for-sale securities, net of
taxes of $104
Adjustment to initially apply FASB 158,
net of taxes of $33
SERP liability adjustment,
net of taxes of $84
Equity in other comprehensive income
of unconsolidated joint venture,
net of taxes of $5
Comprehensive income
Exercise of stock options and
related tax benefi t of $1,329
Restricted stock issuance
Stock compensation
Charitable contribution of stock
Balance, December 31,2006
Net income
Changes in unrealized losses on
available-for-sale securities, net of
taxes of $457
Benefi t plan adjustments,
net of taxes of $44
SERP liability adjustment,
net of taxes of $79
Equity in other comprehensive income
of unconsolidated joint venture,
net of taxes of $41
Comprehensive income
Exercise of stock options and
related tax benefi t of $343
Restricted stock issuance
Stock compensation
Balance, December 31, 2007
Common
Stock Shares
Outstanding
16,386,499
Additional
Accumulated
Other
Paid-In Comprehensive
Loss
Capital
$ (1,643)
$ 91,388
Common
Stock
$ 8,193
Retained
Earnings
$ 34,155
Total
$ 132,093
-
1,546
1,546
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(737)
(665)
80
(6)
-
-
-
-
-
114,602
6,411
-
16,507,512
58
3
-
8,254
3,439
279
2,741
97,841
-
-
-
(2,965)
-
-
-
35,701
-
-
-
-
-
171,017
22,277
70,507
4,736
16,776,049
-
-
-
-
-
-
-
-
-
-
85
12
35
2
8,388
-
-
-
-
-
-
-
-
-
-
5,380
542
6,597
198
110,558
-
-
-
-
-
-
(2,729)
139
43
(111)
6
-
-
-
-
(2,888)
-
692
67
120
(62)
-
-
-
-
-
-
-
-
32,972
7,333
-
-
-
-
(737)
(665)
80
224
(6)
-
3,497
282
2,741
138,831
(2,729)
139
43
(111)
6
(2,652)
5,465
554
6,632
200
149,030
7,333
692
67
120
(62)
8,150
101,539
22,394
-
16,899,982
51
11
-
$ 8,450
2,436
(11)
5,387
$ 118,370
-
-
-
$ (2,071)
-
-
-
$ 40,305
2,487
-
5,387
$ 165,054
($ in thousands)
OPER ATING ACTIVITIES
Net income (loss)
Items not affecting cash:
Depreciation and amortization
Deferred income taxes
Tax benefi t from exercise of stock options
Gain from sale of real estate
Non-cash straight line rent income
Non-cash expense of retirement plans
Gain (loss) on sales of assets
Equity in (earnings) of unconsolidated joint ventures, net
Distribution of earnings from joint ventures
Non-cash issuances of stock and stock compensation expense
Excess tax benefi t from stock-based compensation
Charitable contribution of stock
Changes in certain current assets and current liabilities:
Accounts receivable
Inventories
Prepaid expenses and other current assets
Trade accounts payable and other accrued liabilities
Current deferred income
Income taxes payable
Net cash provided by operating activities of continuing operations
INVESTING ACTIVITIES
Maturities of marketable securities
Funds invested in marketable securities
Reimbursement proceeds from community facilities district
Proceeds from sale of real estate
Distribution of equity from joint ventures
Property and equipment disposals
Property and equipment expenditures
Investment in unconsolidated joint ventures
Other
Net cash used in investing activities of continuing operations
FINANCING ACTIVITIES
Payments on short-term debt
Borrowing of short-term debt
Repayment of long-term debt
Additional cost relating to private placement
Excess tax benefi t from stock-based compensation
Exercise of stock options
Net cash provided by fi nancing activities
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
SUPPLEMENTAL CASH F LOW INFORMAT ION
Interest paid (net of amounts capitalized)
Taxes paid (net of refunds)
2007
Year Ended December 31
2005
2006
$
7,333
$
(2,729)
$
1,546
2,410
(976)
-
(712)
(562)
586
25
(10,580)
8,016
5,387
(343)
-
(1,802)
(1.571)
(338)
(44)
(25)
1,359
8,163
28,697
(21,944)
2,981
-
1,182
33
(9,887)
(6,455)
(438)
(5.831)
-
-
(27)
-
343
2,144
2,460
4,792
4,662
$ 9,454
$
$
70
2,813
2,176
(1,677)
-
(804)
(735)
974
(29)
(1,247)
1,200
7,186
(1,329)
200
895
(495)
(193)
(115)
(12)
(1,076)
2,190
14,910
(26,378)
3,524
2,667
14,735
41
(11,789)
(126)
(664)
(3,080)
(5,400)
5,400
(27)
-
1,329
4,136
5,438
4,548
114
4,662
70
1,039
$
$
$
2,264
(1,007)
989
(571)
(945)
329
5
(423)
-
3,023
-
691
(747)
(19)
462
136
593
6,326
6,440
(12,188)
-
742
1,298
46
(11,128)
(374)
(219)
(15,383)
-
-
(23)
(6)
-
2,508
2,479
(6,578)
6,692
114
70
376
$
$
$
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pa g e 4 0
2 0 0 7 A n n u a l R e p o r t
Performance Graph
The following graph is a comparison of cumulative total shareowner returns for the Company, the Dow Jones Equity Market Index,
and the Dow Jones Real Estate Index for the period shown.
comparison of five year cumulative total returns
280.00
240.00
200.00
s
r
a
l
l
o
d
160.00
120.00
80.00
40.00
Directors and Executive Offi cers
Board of Directors
Kent G. Snyder
Chairman of the Board,
Tejon Ranch Company;
Real Estate Attorney
John L. Goolsby
Private Investments and Real Estate
Barbara Grimm-Marshall
Co-owner
Grimmway Farms
Norman Metcalfe
Real Estate and Investments
George G.C. Parker
Dean Witter Distinguished
Professor of Finance,
Stanford Business School
Robert C. Ruocco
Principal, Carl Marks
Management Company, L.P.,
Investment Management
Geoffrey L. Stack
Managing Director,
SARES-REGIS Group,
Real Estate Development
and Management
Robert A. Stine
President and Chief Executive Offi cer,
Tejon Ranch Company
Michael H. Winer
Portfolio Manager, Third Avenue
Management LLC,
Investment Management
Executive Offi cers
Robert A. Stine
President and Chief Executive Offi cer
Joseph E. Drew
Senior Vice President – Real Estate
Allen E. Lyda
Vice President, Chief Financial Offi cer,
Treasurer and Assistant Secretary
Teri A. Bjorn
Vice President, General Counsel
and Secretary
Dennis J. Atkinson
Vice President – Agriculture
Common Stock Information
Quarter
First
Second
Third
Fourth
high
$ 56.95
50.89
47.72
44.51
2007
low
$ 45.37
44.19
37.70
35.80
high
$ 49.74
49.43
44.78
57.09
2006
low
$ 39.71
38.43
37.55
41.10
0.00
12.31.02
12.31.03
12.31.04
12.31.05
12.31.06
12.31.07
As of February 26, 2008, there were 442 owners of record of our Common Stock.
tejon ranch
dj equity mkt
dj real estate
- Assumes $100 invested on December 31, 2002
- Total return assumes reinvestment of dividends
- Fiscal year ending December 31
tejon ranch
dj equity mkt
dj real estate
2003
38.08%
30.75%
36.90%
2004
-0.51%
12.01%
31.22%
2005
-2.16%
6.32%
9.64%
2006
39.88%
15.57%
35.50%
2007
-26.84%
6.01%
-18.15%
The stock price performance depicted in the above graph is not necessarily indicative of future price performance. The Performance
Graph will not be deemed to be incorporated by reference in any fi ling by the Company under the Securities Act of 1933 or the
Securities Exchange Act of 1934, except that the Company specifi cally incorporates the Performance Graph by reference.
The Dow Jones Real Estate Index, for the most part, includes companies which have revenues substantially greater than those of the
Company. The Company is unaware of any industry or line-of-business index that is more nearly comparable.
Corporate Directory
Corporate Offi ce
Tejon Ranch Company
Post Offi ce Box 1000
4436 Lebec Road
Lebec, California 93243
Telephone: (661) 248-3000
Securities Listing
Tejon Ranch Company
Common Stock is listed on
the New York Stock Exchange
under the ticker symbol: TRC
Stock Transfer Agent and Registrar
Mellon Investor Services LLC
85 Challenger Road
Ridgefi eld Park, New Jersey 07660
Auditors
Ernst & Young LLP
Form 10-K
A copy of this report and the Company’s
Annual Report to the Securities and
Exchange Commission
on Form 10-k, without exhibits, will be
provided without charge to any stockholder
submitting a written request to the
Corporate Secretary:
Tejon Ranch Company
Post Offi ce Box 1000
4436 Lebec Road
Lebec, California 93243
All aerial imagery used by permission of DigitalGlobe, Inc. Copyright 2006-2008 - All Rights Reserved.
For information on similar aerial imagery, contact Richard Schulman (858) 581-6682 or resourcestrategies@usa.net.
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