Mission’s Q3 gets boost from international segment, though profit, income drop a bit
Mission Produce's third quarter report shows a 22% increase in its International Farming segment revenue over last year, with higher total revenue and avocado volume sold. Gross profit, net income and adjusted net income, however, were down somewhat from last year, according to the Oxnard, Calif.-based company third quarter financial report.
Mission's total revenue for the third quarter of 2021 was $246.8 million, according to the report, 4% higher than the same period last year. The volume of avocados sold was up by 2%, with an average selling price also 2% higher than last year.
Gross profits of $40.9 million in the quarter accounted for 16.6% of revenue, a decrease of 7% from last year, according to the company.
"We were pleased with our fiscal third quarter performance amid heightened industry volatility that was brought about by Mexico’s delayed transitional harvest timing," Mission founder and CEO Steve Barnard said in the report.
"Our team did an excellent job navigating this complex period and produced per-unit margins within the range of our expectations, though toward the lower end as a result of pricing volatility."
The declines in gross profit and the gross profit percentage were related to tighter per-unit margins in sourcing California and Mexican product, according to the report, a situation which was further exacerbated by a smaller California crop and smaller Mexican fruit.
Sales in the company's International Farming segment reached $66.1 million in the three months ending July 31, according to the report, which the company attributed to higher volumes of fruit thanks to improved harvest yields from maturing Peruvian orchards.
"Mission’s global sourcing and distribution network, along with owned production in Peru, proved to be a significant advantage for us during the quarter, with nearly 45% of our third quarter U.S. distributed volume being sourced outside Mexico, which we believe is significantly greater than that of the industry," Barnard said in the report.
"Our vertical integration was the key in our ability to significantly mitigate the influences of Mexico’s unpredictability, while also positioning us to drive an 18% increase in our distributed volume to our export markets versus prior year. As we look to the future, the infrastructure investments that we have made in distribution and fruit supply leave us well positioned to capitalize on opportunities as market conditions improve."
