Limoneira’s Q3 revenue declines slightly amid lower avocado pricing

September 10 , 2018

U.S.-based Limoneira recorded a 5% rise in net income during the third quarter to US$8.2 million, while total net revenue decreased by 1% to US$40 million.

EBITDA fell by 11% to US$13.4 million over the three-month period ended July 31.

Agribusiness revenue decreased by 1% to US$38.7 million, primarily due to a smaller than expected avocado crop that was hit by the heatwave.

The agribusiness revenue included a 2% increase in lemon sales to US$30.7 million, primarily due to higher volume offset by lower prices of fresh lemons.

Approximately 992,000 cartons of fresh lemons were sold over the period at a US$25.91 average price per carton compared to around 919,000 cartons sold at a US$28.45 average price in last year’s third quarter, the company said.

Avocado revenue fell by 25% to US$5.6 million, primarily the result of lower prices partially offset by higher volume. Orange revenue nearly doubled to US$2 million.

“Strong lemon and orange results in fiscal third quarter were partially offset by reduced avocado pricing due to a record heat that occurred late in the third quarter,” said president and CEO Harold Edwards. 

“The positive pricing environment and increased volume for lemons continues to improve since the end of the third quarter and we are very confident we will achieve our full year guidance. Our Chilean lemon volume and pricing in the fourth quarter is exceeding our previous expectations and continues to reduce the seasonal nature of our business.”

He highlighted that in the quarter the company successfully completed a US$69 million capital raise which was followed by two major acquisitions – San Pablo in Chile and Oxnard Lemon in California.

“The capital raise combined with expected EBITDA growth in the coming years has us well positioned for additional acquisitions,” he said.

Senior vice president Alex Teague said the  purchase of the San Pablo ranch in Chile provides the company with “significantly expanded production that we are able to leverage through our investment in Rosales packing and allows further seasonal diversification of our fruit.”

“The Oxnard Lemon packinghouse acquisition in California greatly enhances our ability to handle the expected future growth of our packing operations,” he said.

 

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