Calavo reports 20% increase in total revenue for the quarter ending July 31
Santa Paula, Calif.-based Calavo Growers Inc. reported total revenue for the quarter ending July 31 reached $342 million, 20% above the same quarter a year ago.
The company reported that its Grown segment, reflecting fresh avocado sales, showed revenue of $207.6 million, a 28% increase compared with the same quarter last year. Its Prepared segment revenue for the quarter ending July 31 was $134.9 million, up 9% from a year ago.
The company reported gross profit of $18.5 million for the quarter ending July 31. That was 5.4% of revenue, compared with 2.8% of revenue for the year-ago quarter.
“I am pleased that our teams successfully navigated temporary avocado price volatility that impacted both our Grown and Prepared segments, particularly in July,” Brian Kocher, president and CEO of Calavo Growers, said in a news release. “Despite the volatile conditions, we delivered sequential and year-over-year improvement in our Prepared segment ... however, a temporary but sharp increase in fruit input costs for our guacamole product line suppressed overall Prepared earnings. Avocado input costs declined significantly in August, and we expect margins to normalize during the fourth quarter.”
Avocado supply challenges and price volatility in Mexico also negatively impacted the results of the company’s Grown segment in July, as sales volume slowed and sales prices fell faster than the company could move its inventories, Kocher said in the release.
“While our disciplined avocado inventory management practices helped us maintain our targeted gross profit per carton in the quarter, lower than expected volume put pressure on our overall profitability,” he said. “Conditions in the Grown segment started to recover in August and margins are now tracking toward the historical range of $3-$4 per carton. But volume will remain challenged in the near term.”
In the third quarter, Kocher said Calavo filled key roles on its leadership team, including a new chief financial officer role, now held by Shawn Munsell, and the company’s new Senior Vice President and General Manager of Calavo Grown Danny Dumas.
In August, Calavo hired Helen Kurtz as the company’s senior vice president and general manager of Calavo Prepared.
“Danny and Helen are filling roles held by long-time Calavo leaders Robert Wedin and Ron Araiza, respectively, who are both retiring after serving the company for many years, and we thank them for all they’ve done for Calavo,” Kocher said. “With our new senior management team in place, we are ready to accelerate the development and execution of our strategic vision.”
