Limoneira Company Reports Q2 FY 2024 Financial Results
Company Overview
Limoneira Company (Nasdaq: LMNR), a diversified citrus growing, packing, selling, and marketing firm with related agribusiness and real estate development operations, today announced its financial results for the second quarter ended April 30, 2024.
Management Comments
Harold Edwards, President and CEO, highlighted two major milestones for Harvest at Limoneira, the company’s real estate development joint venture with the Lewis Group of Companies. The joint venture completed Phase 2 of the project with 554 additional homesites and received approval from the Santa Paula City Council to increase the total number of entitled lots by 550, or 37%. These developments have raised projected cash flow from the joint venture by 46%, anticipating $180 million in future proceeds over the next seven years, including $18 million in fiscal year 2024. The company’s non-GAAP Adjusted EBITDA for the quarter doubled to $16.6 million from the previous year, driven by the Harvest project’s momentum. Additionally, Limoneira plans to expand avocado plantings by 1,000 acres over three years, with 223 acres in fiscal year 2024. These initiatives are expected to boost long-term non-GAAP EBITDA to $45-$55 million by fiscal year 2030, up from the previous target of $30 million.
Fiscal Year 2024 Q2 Results
Total net revenue for Q2 FY 2024 was $44.6 million, down from $48.1 million in Q2 FY 2023. Agribusiness revenue decreased to $43.3 million from $46.7 million, and other operations revenue was $1.3 million, compared to $1.4 million in the same period last year.
Fresh packed lemon sales were $25.8 million, down from $26.6 million. About 1,446,000 cartons were sold at an average price of $17.85 per carton, compared to 1,547,000 cartons at $17.23 per carton last year. Brokered and other lemon sales were $3.8 million and $2.5 million, respectively.
Avocado revenue dropped to $2.3 million from $3.6 million, with 1,595,000 pounds sold at $1.47 per pound, compared to 941,000 pounds at $1.30 per pound last year. FY 2023 avocado revenue included $2.4 million from a legal settlement.
Orange revenue was $1.2 million, down from $1.4 million, with 66,000 cartons sold at $17.58 per carton, compared to 88,000 cartons at $15.72 per carton last year.
Specialty citrus and other crops revenue was $0.8 million, down from $1.0 million, with 29,000 and 41,000 40-pound carton equivalents sold at $29.24 and $24.78 per carton, respectively.
Farm management revenues increased to $2.0 million from $1.4 million.
Total costs and expenses decreased to $49.3 million from $51.9 million, primarily due to the 2023 Cadiz Ranch asset disposal, partially offset by increased agribusiness and SG&A expenses.
Operating loss was $4.7 million, compared to $3.9 million. Net income applicable to common stock was $6.4 million, compared to a net loss of $1.7 million last year. Net income per diluted share was $0.35, compared to a net loss per diluted share of $0.10 last year.
Adjusted net income for diluted EPS was $8.1 million or $0.44 per share, up from $3.9 million or $0.21 per share. Non-GAAP adjusted EBITDA was $16.6 million, up from $6.2 million.
First Six Months Results
For the first half of FY 2024, net revenue was $84.3 million, down from $86.0 million. Operating loss was $12.4 million, compared to operating income of $22.0 million last year. Net income applicable to common stock was $2.7 million, down from $13.8 million. Net income per diluted share was $0.15, compared to $0.75.
Adjusted net income for diluted EPS was $4.8 million or $0.27 per share, compared to an adjusted net loss for diluted EPS of $5.3 million or $0.30 per share.
Balance Sheet and Liquidity
Net cash used in operating activities was $13.3 million, down from $18.4 million. Net cash used in investing activities was $2.9 million, compared to net cash provided by investing activities of $95.4 million last year. Net cash provided by financing activities was $14.0 million, compared to net cash used in financing activities of $68.0 million last year.
The sale of Northern Properties in January 2023 resulted in $98.4 million in proceeds, used to pay down domestic debt, except for a $40.0 million non-revolving line of credit. Long-term debt was $59.5 million as of April 30, 2024, up from $40.6 million at the end of FY 2023, resulting in a net debt position of $58.7 million.
Real Estate Development and Property Sales
The joint venture with Lewis for the Harvest project was initially approved for 1,500 residential units. Phase 1 (121 units) and Phase 2 (554 units) are complete, with 1,261 total units closed. The Santa Paula City Council approved an increase to 2,050 units, including 250 additional single-family homes in Phase 3. A separate joint venture plans to construct 300 multi-family rental homes on a mixed-use portion of the project.
