The Santa Paula, Calif.-based Limoneira Co. has reported a big increase in operating income for the quarter ending July 31, which is tied to record avocado revenues and higher fresh lemon sales.
“Operating income increased over 200% and our top line by 20%, driven by record avocado revenues and increased fresh lemon sales in the third quarter of fiscal [year] 2022,” Harold Edwards, president and CEO, said in a news release. “Our strategic approach to fresh utilization enabled our sales and marketing team to successfully market our fresh lemons throughout the year. In addition, our avocado segment has continued to outperform expectations this fiscal year, with pricing almost doubling year over year, resulting in record avocado revenues of $12.6 million in the third quarter of 2022.”
Lemon pricing remained challenged in the third quarter as the domestic and global lemon markets continue to work through a surplus of inventory, Edwards said in the release. “Our industry continued to face rising labor costs and higher packing and supplier costs, but our strong top line and more efficient marketing and selling plans more than offset these cost increases.”
Edwards said the company’s new strategic plan to expand citrus sourcing, increase its avocado plantings and strategically sell certain assets to dramatically increase cash flow is progressing as expected.
“We will continue to develop “best in class” grower services to recruit additional grower partners,” he said in the release, noting the company has more than 15,400 acres of agricultural lands, real estate properties, and water rights in California, Arizona, Chile and Argentina with a fair-market-value of over $600 million.
“Selective monetization of certain assets in Limoneira’s portfolio potentially creates a tremendous value creation opportunity for our shareholders,” he said in the release.
Third quarter results
For the third quarter of fiscal year 2022, ending July 31, total net revenue increased 20% to $58.9 million, according to the release.
Agribusiness revenue was $57.6 million for the quarter, up from $48 million in the third quarter of last fiscal year, according to the release.
Agribusiness revenue for the third quarter includes $27.8 million in fresh lemon sales, up from $24.4 million of fresh lemon sales during the same period of fiscal year 2021, the release said.
Approximately 1.51 million cartons of fresh lemons were sold during the third quarter at an $18.39 average price per carton compared to approximately 1.14 million cartons sold at a $21.34 average price per carton during the third quarter of fiscal year 2021, according to the release.
Limoneira saw a record $12.6 million of avocado revenue in the third quarter, up from $4.1 million in the same period last fiscal year, according to the release.
Approximately 5.7 million pounds of avocados were sold during the third quarter at a $2.21 average price per pound , compared to approximately 3.5 million pounds sold at a $1.16 average price per pound during the third quarter a year ago, according to the release.
The company recorded $3.7 million of orange revenue in the third quarter, compared with $2 million in the same period last year. Approximately 209,000 cartons of oranges were sold during the third quarter at a $17.88 average price per carton, compared to approximately 259,000 cartons sold at a $7.65 average price per carton during the third quarter a year ago, according to the release.
