Financial Data and Key Metrics Changes - For the second quarter of fiscal year 2025, total net revenue was 35.1million,downfrom44.6 million in the same quarter of the previous fiscal year, representing a decline of approximately 21% [16] - Agribusiness revenue decreased to 33.6millionfrom43.3 million year-over-year, primarily due to a temporarily oversupplied market causing significant pricing pressure [16][17] - The company reported a net loss applicable to common stock of 3.5millionforthesecondquarter,comparedtoanetincomeof6.4 million in the same period last year [20] - Adjusted EBITDA for the second quarter was a loss of 167,000,comparedtoagainof16.6 million in the same period of the previous fiscal year [22] Business Line Data and Key Metrics Changes - Fresh packed lemon sales were 19.7million,downfrom25.8 million year-over-year, with 1.4 million cartons sold at an average price of 14.52percarton,comparedto17.85 in the previous year [17] - Avocado revenue increased to 2.8millionfrom2.3 million, with 1.2 million pounds sold at an average price of 2.26perpound,comparedto1.47 in the previous year [18] - Orange revenue rose to 1.6millionfrom1.2 million, with 92,000 cartons sold at an average price of 17.07percarton,comparedto17.58 in the previous year [18] Market Data and Key Metrics Changes - The company expects relief from current market conditions in the second half of the year as it anticipates achieving more substantial market share and benefiting from seasonal pricing improvements [17] - The citrus sales and marketing plan with Sunkist is expected to enhance resilience to market volatility by creating a more efficient cost structure [17] Company Strategy and Development Direction - The company is merging its citrus sales and marketing operations with Sunkist Growers, which is expected to improve supply chain efficiency and reduce costs by approximately 5millionannually[6][8]−ThepartnershipwithSunkistaimstoenhancethecompany′scitrusbusinessmodelandexpandaccesstofoodserviceandretailcustomers[10][12]−Thecompanyremainscommittedtogrowingitscitrusbusinessthroughmultiplechannelsandenhancinglong−termreturns[12]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementexpressedconfidenceintheoperationalenhancementsandstrategicinitiativesthatareexpectedtocontributetosustainablelong−termshareholdervalue[13]−Thecompanyanticipatesfreshlemonvolumestobeintherangeof4.5millionto5millioncartonsforfiscalyear2025,downfrompreviousexpectations[24]−ThepartnershipwithSunkistisexpectedtocreateastrongeroperationalfoundation,despiteareductioninoverallrevenueduetothetransitionofthebrokeragebusiness[25]OtherImportantInformation−Totalcostsandexpensesforthesecondquarterdecreasedby2238.5 million compared to 49.3millioninthepreviousyear[19]−Long−termdebtincreasedto54.9 million as of April 30, 2025, compared to $40 million at the end of the previous fiscal year [23] Q&A Session Summary Question: Can you elaborate on the brokered fruit business and its impact? - The brokered fruit business will be going away, but party cartons will continue to run through the facility and be reflected on the top line [30][31] Question: How should we think about the per box economics of the Sunkist deal? - The deal involves a fixed cost model for sales and marketing, which is expected to reduce costs significantly compared to previous arrangements [32][34] Question: What is the current state of the avocado harvest? - The weather has been favorable, and the strategy of delaying the harvest is expected to yield larger fruit sizes, which typically command better pricing [40][41] Question: Will any of the recent plantings contribute to increased yield by fiscal year 2026? - Early plantings are progressing well, and the company is optimistic about achieving higher yields sooner than expected [44][46]
Limoneira(LMNR)2025-06-09 21:32