Santa Paula, Calif.-based Limoneira said strong lemon and orange returns in the quarter ending July 31 were partly negated by lower avocado pricing.
The company reported total net revenue of $40 million, off a fraction from total net revenue of $40.4 million in the same quarter a year ago.
“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,” Harold Edwards, president and CEO, said in a news release. “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.”
In June this year, the company completed a public offering of 3,136,000 shares of its common stock at a public offering price of $22 per share, for total gross proceeds of approximately $69 million. In June and July 2018, the company used the offering proceeds to pay down debt, purchase San Pablo ranch and purchase Oxnard Lemon’s packinghouse, related land and certain other assets, according to the release.
The two strategic acquisitions expand the company reach and enable it to reduce the seasonality by being a year-round supplier of citrus, Alex Teague, senior vice president for Limoneira, said in the release.
Comparative returns
Highlights of the third quarter results included:
- Approximately 992,000 cartons of fresh lemons were sold by the company in the quarter ending July 31 at a $25.91 average price per carton, compared with 919,000 cartons sold at a $28.45 average price per carton a year ago;
- Avocado revenue for the quarter was $5.6 million, compared with $7.5 million a year ago; and
- Orange revenue was $2 million for the quarter, up from $1.1 million for the same quarter last year.
For the 2018 fiscal year ending Oct. 31, the company said it has narrowed its guidance:
- Limoneira said it now expects to sell between 3.2 and 3.4 million cartons of fresh lemons at an average price of approximately $25.50 per carton, compared to the previous range of 3.1 and 3.3 million cartons of fresh lemons at an average price of approximately $24.50 per carton;
- The company said it expects to sell about 6.3 pounds of avocados at approximately $1.04 per pound, compared to the previous range of 6.0 to 6.5 million pounds of avocados at approximately $1.30 per pound. The reduced price per pound, the company said, is due to the reduced quality of fruit from the excessive heat experienced towards the end of the third fiscal quarter; and
- Company now expects operating income for fiscal year 2018 to be approximately $15 million to $16.1 million compared to the previous range of $15.7 million to $17.8 million.
