Gladstone Land Corporation (NASDAQ:LAND) Q4 2025 Earnings Call Transcript

Gladstone Land Corporation (NASDAQ:LAND) Q4 2025 Earnings Call Transcript February 25, 2026

Operator: Greetings, and welcome to the Gladstone Land Corporation Year-End and Fourth Quarter Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, David Gladstone, President and Chief Executive Officer. Thank you. You may begin.

David Gladstone: Well, thank you for that nice introduction. And this is David Gladstone, and welcome to the quarterly conference call for Gladstone Land. Thank you all for calling in today. We appreciate you take time out of your day to listen to our presentation. Hopefully, we give you some indication of where we’re going. Now, we’ll hear from Catherine Gerkis, our Director of Investor Relations, to provide a brief disclosure regarding certain regulatory matters concerning this call and this report. Catherine, go to it.

Catherine Gerkis: Good morning. Today’s call may include forward-looking statements, which are based on management’s estimates, assumptions and projections. There are no guarantees of future performance, and actual results may differ materially from those expressed or implied in these statements due to various uncertainties, including the risk factors set forth in our SEC filings, which you can find on the Investors page of our website, gladstoneland.com. We assume no obligation to update any of these statements unless required by law. Please visit our website for a copy of our Form 10-K and earnings press release, both issued yesterday for more detailed information. You can also sign up for our e-mail notification service and find information on how to contact our Investor Relations department.

We are also on X @GladstoneComps as well as Facebook and LinkedIn. Keyword for both is the Gladstone Companies. Today, we’ll discuss FFO, which is funds from operations, a non-GAAP accounting term defined as net income, excluding gains or losses from the sale of real estate and any impairment losses on the property plus depreciation and amortization of real estate assets. We may also discuss core FFO, which we generally define as FFO adjusted for certain nonrecurring revenues and expenses and adjusted FFO, which further adjusts core FFO for certain noncash items, such as converting GAAP rents to normalized cash rents. We believe these metrics can be a better indication of our operating results and allow better comparability of our period-over-period performance.

Now I’ll turn it back over to David Gladstone.

David Gladstone: Thank you, Catherine. Folks, we sold a few more farms during the fourth quarter, which brought us to 6 property sales for the year totaling $95 million in proceeds, and we recognized an aggregate gain from these sales of about $21 million. So your company is in good shape today. After these sales, we still own nearly 99,000 acres across 144 farms, so about 56,000 acre-feet. In case you forgot, I’ll translate that to 18 billion gallons of water that we’ve got stored in aquifers, and so we’re in good shape for that part of our work. Our farms are in 14 different states and our water assets are all in California. And right now, there’s plenty of water in California. So we’re all in good shape from that perspective.

Regarding the two sales we completed during the quarter, one was a small blueberry farm down in North Carolina. The tenant had fallen behind in his rents, and it was a tough property for us to get to new tenants. So while we took a small loss in the sale, we thought it best just to get rid of that farm since it was out of the normal territory that we’re in. The other sale was a really nice farm in Colorado, where the lease was set to expire at the end of the year, and we were likely facing a downward rent bump and reset. So we took the opportunity to sell the property for more than we had in it originally and paid. So it was decided to go ahead and take the gain and move from that area of farms. We may consider selling some additional farms.

In fact, we’ve got several that we’re talking to buyers over the next few quarters and this part of ongoing portfolio review. If we’re able to complete some of those, we’d like to use most of the proceeds to pay down debt and also to buy back some of that more expensive preferred stock that we have and trigger a gain there. But we’re still evaluating the opportunities. And at this point, we’re hopeful of a good transaction that will come and show how good we are in buying and holding these properties. On the acquisition side, financing costs, which seem to be slowly moving closer to where we like them to be, but we’re not quite there yet. We’re hoping interest rates will continue to move in the right direction. That is down. So we can get back to growing the portfolio as we’ve been out of the business for quite a while.

We’ve got a lot of land that we own, but it’d be nice to pick up some now because prices seem to be moving in the right direction. We’re still taking a disciplined approach to any new investments. Interest rates and our overall cost of capital remain elevated and the capital rates on most row crop farmland is still too low to make it economically work for us today if we have to use a lot of debt to buy it. On the leasing side, first, we’ve talked about on prior calls due to the market conditions affecting certain permanent crops, particularly nuts and wine grapes, we adjusted the lease structure on a handful of properties to help our growers reduce their fixed costs. And as a result of doing that reduction, in essence, we’re taking a larger percentage of the gross crop sales instead of fixed rent payment.

We also decided to direct operation of two properties ourselves with the help of third-party operators. We believe a lot of the farms in the United States are just set up like that. So people bring in farming expertise as we are. And well, I’ll let Bill and Lewis, the two next speakers talk about that. But overall, we had a successful harvest, particularly with almonds and pistachios. We’re still expecting significant amounts of revenue from the 2025 pistachio harvest to come during 2026. So they’re not in there yet. But we won’t know the exact amount until the processes of those nuts have their finalized, their settlement with us. I wanted to remind everyone about this modified structure that we’re using because we’re simple approach to most of these farms for 2026 crop year is going to be exactly the same as we used last year.

And I think it’s also important to again highlight the role of crop insurance. In these cases, one of the reasons we feel so confident in taking this approach, which is a little bit like gambling on these special farms is their strong history of high production. And since insurance coverage is largely based on historical yields, we’re able to secure relatively high levels of insurance. So to give you an example of this, if one of our crops was that’s insured is wiped out by some strange disease or whatever, the insurance allows us to recover the amount of capital that we put into these farms. And that’s nice to know that the downside is covered. Our goal is still to eventually transition these leases back to more traditional structure with fixed base rents.

But our ability to do so will depend on many factors actually, external factors such as crop productions, crop prices, interest rates, input cost of growing the nuts or whatever strawberries and water availability. We’ve kind of got the last one covered to some degree, water availability, as you probably read in the newspapers and reports. Water is plentiful in California and the amount of snow in the mountains, which will melt during the summer and run off is pretty good shape. In other leasing activity, we executed 5 renewals during the quarter. We saw a modest increase of about 7% on two of these row crops as a renewal. For three permanent crops, we reduced the fixed base rent in exchange for additional crop share component, which is what we’ve done a lot of time.

We should have roughly flat compared to those of prior leases on those farms. Looking ahead, we have 5 leases scheduled to expire over the next 6 months. In total, this represents about 3.6% of our total 2025 lease revenue. We’re currently in discussions with existing tenants and prospective new tenants about leasing each of these farms. So I’m pretty optimistic about getting those rented. And now I’ll take a quick update of some of the ongoing tenancy matters that we’re working through. We currently have 9 farms that are wholly or partially vacant, and we’re growing crops on some of these. Encompassing 4 of the farms we’ve been direct operators under management agreements with unrelated third-party growers. We also recognize revenue on a cash basis for leases with 3 tenants who collectively lease about 5 of our farms.

That should be okay. We are actively working towards solution for each of these situations. We think we are close to having a resolution in place for a few of these farms soon. And hopefully, we can get some of them off of this list over the next few months. I’m going to stop here. We’ve got Bill Reiman on the call, and Bill is the man who really understands us since he’s been working in the farming area for most of his career. So Bill, take it away.

William Reiman: Thank you, David, and good morning to everybody. Yes, much of our current management focus right now is on the properties that are being operated under these modified lease agreements or farmed directly utilizing third-party farm operators. We’ve completed harvest for 2025, and we’re pleased to report that the overall yield objectives that we had in our budgets, we exceeded all of that. And so really good results there. We’re renewing some of these modified lease arrangements, particularly on 5 of the 8 farms. 2 of the remaining 3 are redevelopment projects and the last one, our wine grade vineyard in Napa is now leased to a local grower. So we’re happy to have that done. The 5 farms that we ended up, that we’re renewing agreements on were really our top performers from this group last year.

So we’re expecting another really strong year of results. The winter, David touched on a little bit about some recent weather. The winter for us has been about average for precipitation with a couple of our wettest months left to come. Recently, we’ve had some major storms that really boosted the snowpack levels. So there’s significant optimism that the surface water allocations for 2026 will be very strong. Those reservoirs, both state and federal water projects are above historical averages. So for the short term, there’s plenty of supply. Chilling hours, we’re projecting a low to medium level of chilling hours this winter in California. It means we should meet all chill requirements in all of our permanent crop locations. So that’s very good news.

Almond bloom, as of today, we’re probably 2/3 complete. The bloom’s has been a bit uneven. There’s been reports of flash bloom in many locations around the valley, Central Valley. And also with the cold and rainy weather, the bee activity hasn’t — it’s been somewhat limited in quite a few areas. This could possibly cause almond yields to be lower across the state. Pistachios, wine grapes, of course, are still in dormancy. So they’ve actually reaped the benefit of some of this colder wet weather and haven’t had the bloom exposed yet. Markets, tariff drama, trade tensions still exist as we all read the headlines. However, crop markets seem to have settled in and accepted this uncertainty to a large degree. Nut crop markets continue to show notable resilience and strength, particularly for pistachios.

The important story lately is the fact that the supply chain seems to be pretty light. There’s minimal product in both almond and pistachio buyer side supply chains, which we think has provided upward pressure on pricing. As a result, our base guaranteed price for the current crop remains consistent with 2024, and we believe there’s a strong likelihood that the final price for 2025 crop will actually be higher than our final 2024 pricing. One of our processors, in fact, recently announced an extra $0.50 per pound bonus to be paid with our scheduled April crop payment for pistachios for the 2025 crop, that’s really good news. This momentum could also result in a higher base price for the 2026 crop when that gets announced in July of this year.

So things are looking up in pistachios. Almond prices dipped in January, but since then, they’ve rebounded quite a bit and climbing again as we move through boom season. I don’t expect these prices to vary too much as there’s strong demand and confidence in the market. There will be some slight bouncing around as projections for the 2026 crop start to come out and we get to this point in bloom and everybody has an opinion on what the crop is going to do. So we will definitely see that reflected in the market. But it is — the market is, in general, severely underbought and the supply chain is light. So those are things and growers are reluctant to sell right now. So those are all things that continue to put upward pressure on almond prices.

Wine grape market continues to underperform, but we’re beginning to see some varietals, particularly some white grape varieties that are showing up short in supply. At the moment, this isn’t causing any increase in prices or really provide any incentive for wineries to contract for supply, but it is the very first encouraging sign that we’ve seen in a couple of years. Vineyard removals are continuing at a rapid pace in California and really around the world. So we’re hopeful that this pullback in supply will soon bring the market back into balance, likely flipping it the opposite way and will be underproduced. And then the weakening dollars as long as the dollar continues to weaken, that works in our favor, making our products more attractive to international buyers.

Circling back to water, we’re experiencing, like I mentioned, we’re experiencing a normal to potentially wet year as far as precipitation is concerned. So it’s really good news in that we’re continuing to experience an extended wet period. 4 out of the last 5 years or 5 out of the last 6 years have been average or wet. Full reservoirs, good rainfall, snowpack. They are all key factors for the water market to be full of water for sale at prices that are attractive for our water banking activities. So we’ve been working hard to identify the best water deals for our properties and looking for infrastructure improvements that will yield us the best return on those capital expenditures. Our goal, as always, remains to further strengthen the overall water security of the entire portfolio through long-term and short-term strategic water purchases.

We’re looking to continue investing in water delivery storage infrastructure, pipelines, water banks and then identifying opportunities to create synergies across the farm assets. Now I’ll turn it over to our CFO, Lewis Parrish.

Lewis Parrish: Thanks, Bill, and good morning, everyone. I’ll start with a brief update on our recent financing activity. During the quarter, we repaid a $4 million note that was secured by a property that we also sold during the period. And subsequent to year-end, we redeemed our Series D term preferred stock to avoid a step-up in the coupon from 5% to 8% — that redemption was funded through a combination of common stock issued under our ATM program and a draw on our line of credit. Since the beginning of the fourth quarter, we raised about $50 million of common stock through our ATM program with the majority of those proceeds used to fund that redemption. Turning to our operating results. For the fourth quarter, we recorded net income of about $4.2 million and a net loss to common shareholders of $1.8 million or $0.05 per share.

For the year, we recorded net income of $13.5 million and a net loss to common shareholders of $10.5 million or $0.29 per share. Adjusted FFO for the fourth quarter was $14.4 million or $0.38 per share compared to $3.4 million or $0.09 per share in the same quarter last year. And for the year, AFFO was $14.4 million or $0.39 per share compared to $16 million or $0.47 per share last year. The decreases in AFFO were primarily driven by the recent changes to lease structures on certain farms, timing differences in revenue recognition related to crop sales in certain direct operated farms, lost revenue from farm sales over the past year and ongoing tenancy issues that have led to vacancies resulting in both lower revenues and higher costs. Year-over-year, fixed base cash rents decreased by about $1.9 million for the quarter and by about $19.8 million for the full year.

This is primarily driven by the reasons just mentioned, but mainly the lease modifications on certain properties where we reduced or eliminated fixed base rents or in some cases, provided cash lease incentives in exchange for significantly increasing the crop share components. Partially offsetting that and largely for the same reason, participation rents increased by about $9.3 million on a quarterly basis and by $10.6 million for the full year. This increase was further driven by stronger pistachio pricing compared to last year. Net profit from crop sales in our direct operated farms was about $2.6 million for 2025, which is our first harvest year. However, the full impact of this 2025 harvest is not yet reflected in our financial results.

While we did expense a full year of growing costs, we have not yet recognized a full year of revenues, particularly on the pistachios. As David mentioned, the final marketing bonus payment for the 2025 pistachio crop will be recognized later in 2026, thus creating a timing difference compared to 2024 when this property was fully leased. In addition, we recorded about $4.4 million of termination-related revenue in 2025, including $2 million in the fourth quarter compared to 0 last year. On the expense side, our recurring cash operating expenses increased for both comparable periods. Total related party fees fell by about $200,000 for the year, and that’s primarily due to a lower base management fee resulting from recent farm sales, but was offset by a higher administration fee during the fourth quarter.

Property operating expenses increased for both periods and is mainly driven by the cost of supplemental water we were required to provide on one of our properties pursuant to the lease as well as higher insurance costs and property taxes incurred on one of our direct operated properties. G&A expenses declined in both periods, primarily due to lower professional fees incurred during the current year. And one note on cash flows. Cash flows from operations declined largely due to timing differences between leasing versus operating farms, which is particularly true in the first year of operations. Again, for our direct operated farms, almost all the cash for growing costs went out during 2025, while most of the cash proceeds will be received in 2026.

In addition, regarding the increased participation rents from the lease modifications, a significant portion of the cash payments was received in early 2026, creating another year-over-year timing difference in operating cash flows. Turning to liquidity. We have about $85 million in immediately available capital and over $185 million of unpledged properties that can be used as additional collateral. We are in discussions with a couple of lenders to add certain of these properties to either existing or new facilities. Currently, about 98% of our borrowings are at fixed rates with a weighted average interest rate of 3.39% locked in for another 2.7 years. This has helped shield us from the interest rate volatility we’ve seen over the past few years.

Looking ahead, we have about $17 million of scheduled principal amortization payments due over the next 12 months. We don’t have any loans maturing over the next year, but we do have about $160 million of loans with fixed rate terms that are scheduled to reset over the next 12 months, though the loans themselves are not maturing. This includes $135 million of loans under the MetLife facility that are scheduled to reprice in January of 2027. And finally, regarding our common distributions, in January, we declared a monthly dividend of $0.0467 per share for the first quarter of 2026. At our current stock price of $11.51, this represents a 4.9% annualized yield, which is above the REIT sector average. With that, I’ll turn it back over to David.

David Gladstone: Thank you, Lewis. Good report. Nice to know that we’re in a strong capital position. We are staying active in the market, so we’re ready to go if a good acquisition opportunity comes along. But as mentioned earlier, we’re still being cautious on the acquisition front because our cost of capital remains very high. Overall demand for prime farmland growing berries and vegetables remains stable across most of our regions, partially — particularly along the coast. We also started seeing some signs of improvements in pricing and broader economics around those crops. So we are hopeful that the worst may be behind us, but it’s still too early to say whether we are fully in the clear or not. Overall, in the long run, we expect inflation, particularly in the food sector to continue to move higher, and we’re expecting the values of underlying farmland to increase over time as a result.

We do expect this to especially be true with healthy foods such as fresh fruits and vegetables and nuts like we grow for people, and we are a big producer these days. So now I’ll open it up to some questions from those who are listening in. Operator, would you come on, please, and show them how they can ask some questions.

Operator: [Operator Instructions] Our first question comes from the line of Craig Kucera with Lucid Capital Markets.

Q&A Session

Craig Kucera: I wanted to revisit your commentary regarding the 5 repositioned farms. So basically, are you saying that they’re under similar leases where there won’t be any base rents and you’ll have a portion of higher participation rent expected in ’26 and then will some of that dribble into 2027 as we saw this past year? Or how should we think about that?

Lewis Parrish: Yes, that’s exactly correct. Well, it’s the same structure that — I mean that they’ll be either with no base rent or possibly with a lease incentive, but it will be the same structure as we had in 2025. With the ’25 crop, we had a good amount of the revenue recorded in ’25 and then a portion carryover in ’26, and we’ll have the same thing. But 2026, we’ll be able to benefit from the carryover from the ’25 crop plus the initial payment from the 2026 crop.

William Reiman: And to add to that, it won’t dribble into ’27. It will be just like most of it. For most of ’26 crops, revenue will come in ’27. So it’s — it won’t be a little bit. It will be just like this year.

Craig Kucera: Okay. And what was — I think at the time that you restructured those leases, you thought that I want to say maybe 75% would come through in fourth quarter of ’25. When you kind of step back, and I know you’ve still got some marketing with the pistachios. But as you think about that, what was sort of — what would you say the percentage was that was recognized here in fourth quarter ’25 and kind of what you expect in ’26?

Lewis Parrish: It’s really on a farm-by-farm basis. I think for the pistachio farms, it probably will be close between the 65% to 75% in the first year, but that is us estimating what the marketing bonus is going to be. It could turn out to be higher than that. And if that’s the case, then it would push a higher percentage in the following year. Almonds, a bit of a different story because some of our properties were in, and Bill can expand on this more, but we’re in what’s called a call pool where we decide when to sell the crops — and for those — for example, we have one property for the ’25 crop where we haven’t pulled the trigger yet because we’re seeing prices trend in the positive direction and we want to wait and take advantage of that pricing.

So for pistachios, I think the percentage will generally hold true, assuming that bonus payment stays where it’s been, but — and I’ll let Bill talk on this, too, but we are seeing signs of that possibly being higher. So again, that would push the percentage higher in the subsequent year. Bill, anything you want to add to that?

William Reiman: Yes. I mean that’s correct. Certainly, on pistachios, we feel the likelihood of increased bonus payments, that’s increasing every day. So we feel pretty strong about that. And Lewis mentioned the almonds on the call pool, one particular farm, we decided to make the call of when we’ll sell, and we’re kind of holding out for some higher almond prices. But in that particular farm, we did get crop insurance payout. So we’re already in positive territory as far as whether we made money or lost money on that farm. But we still have the crop — a small amount of crop to sell, and we’re just holding out for higher prices.

Craig Kucera: Got it. And just one more on this topic. I guess, are you saying then that you would probably recognize more sort of variable payments throughout the year than you typically would because you have more control over when and at what price you sell the crop? Or should we think about this that this will mostly be recognized in the fourth quarter as far as what was earned in 2025?

Lewis Parrish: I think we’ll have a little bit more in the first half of the year than we typically do. Just as Bill mentioned, that we do have one pistachio processor who announced they will pay a portion of that marketing bonus early in April. So we will probably be able to pull some of that into Q1. But other than situations like that or maybe further adjustments to almond pricing, we would probably see the most bulk of it coming in Q3 and especially Q4 again.

William Reiman: The other impact if the pistachio market continues its current trend and our guaranteed base price goes up, that will increase the amount that we are able to claim in within this calendar year. But we won’t know that until probably the end of — usually end of July.

Craig Kucera: Okay. Changing gears, Lou, what are your expectations for interest paid for this year in the first quarter?

Lewis Parrish: I’d expect it to be anywhere from 10% to 15% less than what we recognized in 2025, and that’s assuming the percentage of interest that gets paid, that gets refunded is the same, but reflecting just the loan balance decrease over the past year as we’ve paid off some loans.

Craig Kucera: Okay. I see you raised $33 million in ATM this quarter. Was the remainder of the Series D funded with cash on the balance sheet or the line of credit?

Lewis Parrish: Line of credit. We currently have about $10 million outstanding on the line of credit, and that’s currently at a 5.69% variable rate.

Craig Kucera: Got it. Okay. Just one more for me. I know one of your competitors have been generating significantly higher returns through lending to farmers and is seeing decent demand there. Given the somewhat tougher farming economy, is that something you guys are looking at a little harder? I believe you capped that type of activity to 5% of assets, but would just like to get your read on that situation.

Lewis Parrish: We’ve had discussions about getting a loan program started up, but we haven’t pulled the trigger yet. It’s something that we may continue to discuss. But at this point, we don’t have any plans to — any solid plans to put that program in action yet.

William Reiman: I’ll add to that. I was just going to say, I would say long term, that’s something we’re really keeping an eye on. But I think just current economic conditions, we’ve been really — we’ve looked at some loan deals, but with current economic conditions, it’s just something we just haven’t — we haven’t felt that the risk return profile was really right for us at this time, but it’s something that we continue to look at, continue to get inquiries and probably long term is something we want to, we’ll eventually make some moves on.

David Gladstone: Other questions?

Operator: Our next question comes from the line of John Massocca with B. Riley Securities.

John Massocca: So maybe kind of sticking with the variable rent questions from earlier. With the current season that just closed on pistachios, do you have kind of brackets as to what you think the amount remaining to be collected is just given you have some color into the bonus payments. I was kind of curious if there was a range for what more to expect in ’26 you were seeing out there.

Lewis Parrish: Well, as far as our direct operated farms go, we do have — we are expecting about hopefully, at least $3 million to come in. Now it’s certainly not guaranteed, but if we are to use prior year bonus payment as an estimate as a proxy for this year, and all indications are pointing to the fact that the marketing bonus amount should be at least equal to last year. So if that does hold true, then that would result in about $3 million more coming in during 2026. Of course, that could change, but signs today are pointing positive for that outcome.

John Massocca: Okay. And then maybe as I think about your like kind of truly vacant assets, not the ones that you’re operating yourself, what are kind of brackets around the value of those 5 properties? And would you — I guess, how expeditiously could you sell those if you wanted to?

Lewis Parrish: So the ninth — I don’t have the exact book value or fair value, but if I had to ballpark a figure, I’d say maybe $50 million. However, the largest of those properties, 3 of those vacant properties, we are close to putting together agreements that would get those back into an income-producing position. Again, nothing is finalized or fully guaranteed at this point, but we are hoping that those — the 3 largest of those farms will come off the list, hopefully, within the first half of this calendar year.

William Reiman: And those 3 largest — one reason that they’re vacant and timing is a big factor, right? We lost, the tenant left and trees needed to be removed. But because they were so big, it takes a while to get that done. So a lot of that, the big portion for those being vacant right now is because we’ve had to clean the farms, so we have to pull the trees out and they’re so big, it takes time. But yes, we are — as Lewis said, we’re really close to getting those back into revenue production.

John Massocca: Okay. As a reminder, what is the crop type on those farms?

Lewis Parrish: They were almonds.

William Reiman: Those 3 biggest were almonds. Yes.

John Massocca: Switching gears a little bit. As I think about the Series D repayment having been completed, how are you thinking about ATM usage going forward? I mean was the ATM, particularly ATM quarter-to-date really tied to that repayment? Or are you looking to kind of delever on a more kind of organic basis?

Lewis Parrish: A lot of the ATM usage was for that redemption specifically. But now that that’s out of the way, we would like to focus more on the other preferred securities. So if we continue — right now, we can sell ATM at 5%, we could buy back preferred at 7.5%. If we’re able to get a 2.5 point spread on transactions like that, then that’s something that we would look on favorably and hopefully be able to implement.

John Massocca: Okay. And then lastly, on the water, how are you looking at kind of your own water kind of holdings, acquiring further water holdings, just giving, now since I’ve got a couple of pretty strong seasons in terms of precipitation out West, but just kind of curious if that’s impacting your strategy there at all.

William Reiman: Yes. I mean it’s super positive, right? So when there’s plentiful supply, the price comes down. And we — our driver on buying water is all about the cost, right? And so what we buy it for what it cost to move it and what it costs to hang on to that and hold it for use during reuse in the future in the next drought. And so as these prices come down, I mean, in fact, this week, there’s some what we call Article 21 water release being released next week, and that is like prices $50 to $80 an acre-foot. So this is — these are the opportunities that we jump on, and we try to grab as much of that as we can for the future. So it’s all cost driven for us because that’s your future water cost for some crop down the road. And the lower we can get that, the better we are.

David Gladstone: We have any more questions?

Operator: And there are no further questions. And therefore, I’ll hand it back over to you.

David Gladstone: Well, thank you very much, all of you for listening to this and a little bit disappointed that we’re not getting enough questions. We hope you’ll mark them down during the year and ask us when it comes up in March or April, whenever we’re talking to you again. But thank you all for calling in, and that’s the end of this session.

Operator: Thank you. This concludes today’s conference, and you may disconnect your lines at this time. Thank you, and have a great day.