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| Statement |
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| We have dramatically decreased interest expense, removed our pension obligation, are receiving quarterly payments from Yuma Mesa Irrigation and Drainage District for our fallowing program, and we believe lemon pricing will be better this year compared to fiscal year 2023, positioning us well for strong improvement in fiscal year 2024 |
| It's a small niche, but we believe it's a sustainably very profitable niche and one that we believe we will have a great opportunity for our shareholders to participate in |
| We are very encouraged to see our strategic shift towards an asset-lighter business model reflected in our results with agribusiness expenses decreasing by 5%, agribusiness operating loss improving by 84% and our adjusted EBITDA improving by 39% in the seasonally soft first quarter of fiscal year 2024 compared to the prior year period |
| And because we're within 600 miles of our -- a very, very strong customer base, we believe we have a significant logistical advantage to the market but also can deliver very fresh fruit that our customer base wants |
| But the possibilities and the potential looks pretty exciting for us at this point |
| We believe that, that will significantly enhance the growth of EBITDA just given the per acre profitability of avocados versus lemons currently |
| Today, we consider ourselves to be in a strong financial position, having recently reduced our net debt position and rightsized the balance sheet through our ongoing strategic shift towards an asset-lighter business model |
| So it's -- we're feeling good about it |
| We have 700 acres of nonbearing lemons and avocados estimated to become full bearing over the next four to five years, which we expect will enable strong organic growth in the coming years |
| The $3.1 million improvement is a result of the actions we took last year to include exiting unprofitable farming operations in Cadiz, selling our Northern Properties to perform farm management services and entering a water fallowing program in Yuma, Arizona, which have put us in a much stronger financial position this year |
| In addition to our operational improvements, our Board and management team will continue to evaluate how to best leverage our expertise in farm management, packing, marketing and distributing citrus combined with our valuable portfolio of agricultural lands, real estate properties and water rights in order to enhance long-term shareholder value |
| And as we look into our crystal balls at the future, we believe that, that will be very beneficial as well |
| So it's an exciting time |
| All that while, we've been very pleased to have been receiving significant levels of inbound interest from various types of groups that would be interested in some or all of the assets |
| The overall improvements we are making to our business are well aligned with our strategic asset-lighter transition plan |
| We are working to pivot our business towards a model that will streamline our operations, sell non-strategic assets, improve the consistency of our earnings, increase EBITDA and dividends per share, reduce debt, right-size the balance sheet and improve the return on invested capital |
| Our utilizations have been good |
| market window from April to July provides a niche opportunity for California avocados to serve the U.S |
| I wish I had that crystal ball, but I will tell you this, that we believe that there is a wonderful niche that Ventura County and California can serve in the market window of avocado availability from May to July when the market is not as crowded with Mexican supplies or Peruvian supplies |
| Over the past 18 months, we have developed a strategic road map intended to enhance near- and long-term shareholder value |
| So far, so good now and the weather window is opening up, and it looks like we're supposed to get some good weather in the next few weeks |
| As part of our exploration of strategic alternatives to maximize value and due to the strong interest we have received, we have decided it is in the best interest of our stockholders to temporarily pause the sale of the two remaining non-strategic assets as well as move away from pursuing a packinghouse in Chile and instead, add value by focusing on expanding our avocado production over the next three years |
| Agribusiness operating loss improved 84% for the first quarter of fiscal year 2024 compared to the same period in the prior year primarily related to the ongoing execution of the strategic road map and the elimination of unprofitable operations |
| We see the opportunity to convert some of our lemon land into avocado production in Ventura County, accelerating that increase in avocados, but then also balancing that out with our agency business and also our services of packing, marketing and selling to our grower partners, which should keep our lemon and our citrus supply chain growing while at the same time growing our own avocado production |
| So that's our thesis for the transition, and we believe it's sustainable |
| Additionally, we plan to expand our plantings of avocados over the next three years and also expect to have a steady increase in third-party grower fruit |
| So our operations will remain intact |
| For the first quarter of fiscal year 2024, total net revenue increased 5% to $39.7 million compared to total net revenue of $37.9 million in the first quarter of the previous fiscal year |
| The crop is looking great |
| Over Limoneira's 130-year history, it has grown into one of the leading sustainable agribusiness companies in the world, with over 11,000 acres of valuable lands, real estate properties and senior water rights |
| Statement |
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| Results for the first quarter were impacted by increased rainfall in California that delayed the picking of lemons from the first quarter to the second quarter |
| The company sold less cartons of fresh revenues -- fresh lemons in the first quarter of fiscal year 2024 due to lower harvest in that period caused by the significant rainfalls California has received |
| Additionally, avocado harvest will begin in Q2 and run into Q3 due to the seasonality of California avocados and reduced import pressure from Mexico and Peru in the U.S |
| Adjusted EBITDA was a loss of $4.8 million in the first quarter of fiscal year 2024 compared to a loss of $7.9 million in the same period of fiscal year 2023 |
| Plus Ventura County is really the only place you can grow avocados in California significantly anymore due to the challenges further south in San Diego and etc |
| Operating loss for the first quarter of fiscal year 2024 was $7.7 million compared to operating income of $25.9 million in the first quarter of the previous fiscal year primarily related to the gain on the sale of the Northern Properties in the first quarter of fiscal year 2023 |
| So really, we had a few weeks of consistent rains |
| Historically, our first and fourth quarters are the seasonally softer quarters, while our second and third quarters are stronger |
| So what I think is going to happen is that the seasonal window for harvesting and selling is going to truncate from May to July, but the values for those California avocados, we believe, will be significant and I think sustainable because there won't be the strong pressure from the imported fruit to really come in and make the market that much more crowded |
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