Calavo CEO steps down, company posts challenging Q3
California-based avocado company Calavo has announced the retirement of CEO James Gibson, having served in the position for around a year and a half.
Gibson has stepped down effective Sept. 9, and Steven Hollister, a member of Calavo’s Board of Directors since 2008, will assume the role of Interim CEO.
Calavo said the board has engaged an executive search firm to identify Gibson’s successor. In addition to his role of Interim CEO, Hollister will also serve as interim Chief Financial Officer until a new CFO is appointed, and Farha Aslam will return to her role as an independent director.
Gibson will continue as an employee of Calavo through Sept. 30, 2021 to assist in transitioning his job responsibilities.
“I am proud to have had the honor and opportunity to lead Calavo and would like thank all of our employees for their commitment and service to the company. We have accomplished a great deal together, and I wish them the best success in the future,” said Gibson.
J. Link Leavens, Chairman of the Board of Directors, said: "Jim’s contribution to building Calavo into what it is today has been enormous. He has served as CEO since February of 2020, and before that was president of Renaissance Food Group, a company he co-founded and that Calavo acquired more than ten years ago. On behalf of our leadership team and Board of Directors, we want to thank Jim for his vision and leadership and wish him well in his retirement."
Calavo's third quarter results
The company also posted its third-quarter financial results, which were impacted by numerous industry-wide factors as well as delayed avocado crops.
Calavo registered a net loss of $13 million, compared to a net loss of $15.6 million in the same period last year. Gross profit came in at $7.9 million, or 2.8% of revenue, compared to $30.8 million, or 11.4% of revenue.
Total revenue reached $285 million, a 5% year-on-year increase. Fresh segment revenue was flat year-over-year, and Renaissance Food Group (“RFG”) and Foods segments revenues increased 14% and 12% year-over-year, respectively.
“Our results for the third quarter of this year were adversely impacted by inflationary pressures on labor, raw materials and freight, all of which accelerated as the third quarter progressed. These factors taken together with the delayed summer avocado crops coming from California and Mexico impacted our margins and profitability,” said Hollister.
“We are taking the necessary steps to mitigate the current higher cost environment and to navigate the tight labor market and various supply chain issues. While we are managing through challenging times, we are moving forward with the implementation of our strategic initiatives to increase the operating leverage and synergies across our entire organization, and we believe we will emerge as a stronger and more resilient company.
"The underlying fundamental drivers of our business remain intact, and we remain confident in the opportunities we have to accelerate growth in the years ahead.”