(Feb. 22) VISALIA, Calif. — Despite the January 2007 freeze that destroyed large portions of the California and Arizona citrus crops, Sunkist Growers Inc., Sherman Oaks, paid its members $797 million for the 2006-07 season.

That’s the second-largest payout in the cooperative’s history, said Tim Lindgren, Sunkist president and chief executive officer.

Addressing the Sunkist Growers’ 114th annual meeting Feb. 20 at the Visalia Convention Center, Lindgren pointed to the cooperative’s restructuring as a major factor in the positive fiscal picture.

“We reduced expenses by 22%, and while some of the reduction was freeze-related, most of those savings are ongoing,” Lindgren said.

Total revenues for fiscal 2007, which ended Oct. 31, were $994 million, down from the 2006 record of $1.1 billion. Payments to growers in 2006 totaled $865 million.

Grower benefits went beyond the 2007 crop payments.

“The fresh fruit assessment for the 2007-08 season was reduced 12.5 cents,” said Nick Bozick, chairman of the Sunkist board of directors and president of Richard Bagdasarian Inc., Mecca. “At 55 cents, this year’s per carton assessment is 19% less than last year and the lowest rate in many years.”

Lindgren said he is optimistic about the 2007-08 season. The California Agricultural Statistics Service recently upped the navel crop forecast to a record 96 million cartons.

“Sunkist is a historically strong performer in large crop years due to our internationally famous brand and our large and loyal customer network,” Lindgren said.

The cooperative continues to add acreage on what Lindgren called a very selective basis.

“We are adding quality production of the varieties we need to meet market demands,” he said. “We set a strategic goal of bringing 2,000 acres of quality citrus into Sunkist annually, and in 2007 we successfully reached that goal.”

Also on track to beat a 2005-06 record crop is Sunkist’s specialty citrus program, he said. The cooperative also has introduced a tangerine juice pool, which Lindgren said will be a strong growth category.

The moving of Sunkist’s lemon processing from Ontario to Tipton in the San Joaquin Valley is nearly complete, Lindgren said. The move consolidates the cooperative’s orange, tangerine and lemon processing in one location.

“The extraction equipment is already installed at Tipton, and the new lemon lines will be up and running next month,” Lindgren said.

The sale of the Ontario property pays for the move to Tipton, he said, and increases processing capacity by 15%.

Whether Sunkist will retain its Sherman Oaks offices has not been determined, Lindgren said.

He told growers attending the annual meeting that Sunkist had received offers to purchase the headquarters building, but noted management was not yet ready to make a recommendation to the board regarding the facility.

The nearly yearlong evaluation of Sunkist’s marketing division by The Monitor Group Inc., Cambridge, Mass., will result in a more centralized sales operation, said Russ Hanlin, senior vice president of sales and marketing, with fewer sales offices.

Among the benefits, he said, will be shorter response times for customer requests.

Lindgren: Sunkist profits solid in wake of freeze
Tim Lindgren, president and chief executive officer of Sherman Oaks, Calif.-based Sunkist Growers Inc., addresses the cooperative’s 114th annual meeting Feb. 20 in Visalia, Calif. Though a record California navel crop is forecast, Lindgren says he’s optimistic about the 2007-08 season because Sunkist is a historically strong performer in large crop years.