California-based agriculture and real estate company Limoneira (NASDAQ: LMNR) recorded an uptick in lemon revenues in the third quarter, helping total revenue rise by 1% despite a sharp fall in avocado volume and sales.
In contrast, Limoneira said “typical volatility” meant avocado volumes were down, leading to a 22% decline in revenue for the crop.
The company said lower avocado production was the primary factor behind its 7% decline in operating income to US$13.2 million.
Meanwhile, EBITDA fell by almost a quarter to US$14.9 million but the large percentage drop is mainly because in the same period last year Limoneira made a US$3.4 million gain on the sale of stock in Calavo Growers (CVGW).
“Our record lemon sales in the first nine-months of fiscal 2017 enabled us to increase revenue by 14% and offset the lower volume of avocados this year,” CEO Harold Edwards said in a release.
“In addition, our expanding acreage and improving operating efficiencies enabled us to generate record adjusted EBITDA during the first nine months of 2017 and have us very well positioned for record results in fiscal 2017,” he said.
“As we enter the last quarter of fiscal 2017, we are turning our focus to 2018 and will continue to leverage our strengths to provide customers with a year-round global supply of fresh citrus and avocados. We believe our One World of Citrus™ strategy will enable us to deliver meaningful growth and enhance shareholder value for many years to come.”
Senior vice president Alex Teague highlighted recent acquisitions, including the purchase of a majority stake in Chilean producer Pan de Azucar, in addition to expanded lemon planting efforts and a focus on increasing third-party fruit, was expected to produce “solid fiscal 2018 operating results”.
“In addition, the efficiencies we are enjoying from our new lemon packing house are expected to continue to drive higher margins,” Teague said.
Limoneira continues to expect earnings per diluted share for fiscal year 2017 to be in the range of US$0.51 to US$0.55 per share and continues to expect operating income for fiscal year 2017 to be in a range of US$14.7 million to US$15.2 million.