Limoneira swings to loss in Q2 despite higher lemon volumes
California-based Limoneira has swung to a loss in its second financial quarter of the year, following challenges stemming from the Covid-19 pandemic including lower pricing.
The company posted a net loss of US$5m for the three-month period ended April 30, compared to net income of US$2.7m in the second quarter of fiscal year 2019.
Agribusiness revenue was US$38.4m, compared to US$40.8m in the second quarter of the last fiscal year.
“During the second fiscal quarter, our fresh lemon volume increased 13.5%; however, the effects of the COVID-19 pandemic dramatically reduced the pricing of lemons due to an oversupply in North America and reduction in overseas shipments," said Harold Edwards, president and CEO of Limoneira.
"Foodservice restaurants and bars around the world closed due to COVID-19, offsetting the strong growth we achieved in grocery retail revenue."
Avocado and orange revenues increased compared to the same period last year.
Edwards said that during the past few weeks of the third financial quarter, the company is "continuing to experience strong volume in grocery retail and beginning to see a slow improvement in foodservice as certain states begin to open restaurants and bars on a limited basis".
Because of uncertainty around the duration, scope and ultimate financial impact of the Covid-19 pandemic, Limoneira is withdrawing its fiscal year 2020 outlook previously provided on March 11.
The company said that it is currently expecting record lemon volumes for fiscal year 2020 and improvement in adjusted EBITDA during the second half of 2020.
The organization also said that it saw improved sell-through results during the month of May compared to March and April due to seasonality as well as foodservice businesses beginning to open in certain areas of the U.S.