Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Oct. 31, 2022 | Nov. 30, 2022 | Apr. 30, 2022 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Oct. 31, 2022 | ||
Document Transition Report | false | ||
Entity File Number | 000-33385 | ||
Entity Registrant Name | CALAVO GROWERS, INC | ||
Entity Incorporation, State or Country Code | CA | ||
Entity Tax Identification Number | 33-0945304 | ||
Entity Address, Address Line One | 1141-A Cummings Road | ||
Entity Address, City or Town | Santa Paula | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 93060 | ||
City Area Code | 805 | ||
Local Phone Number | 525-1245 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | CVGW | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 0.6 | ||
Entity Common Stock, Shares Outstanding | 17,731,661 | ||
Entity Central Index Key | 0001133470 | ||
Current Fiscal Year End Date | --10-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | Deloitte & Touche LLP | ||
Auditor Location | Los Angeles, California | ||
Auditor Firm ID | 34 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 2,060 | $ 1,885 |
Restricted cash | 1,074 | 970 |
Accounts receivable, net of allowances of $4,199 (2022) and $4,816 (2021) | 59,016 | 78,866 |
Inventories | 38,830 | 40,757 |
Prepaid expenses and other current assets | 8,868 | 11,946 |
Advances to suppliers | 12,430 | 6,693 |
Income taxes receivable | 3,396 | 11,524 |
Total current assets | 125,674 | 152,641 |
Property, plant, and equipment, net | 113,310 | 118,280 |
Operating lease right-of-use assets | 54,518 | 59,842 |
Investment in Limoneira Company | 27,055 | |
Investments in unconsolidated entities | 3,782 | 4,346 |
Deferred income taxes | 5,433 | 5,316 |
Goodwill | 28,653 | 28,653 |
Intangibles, net | 7,206 | 8,769 |
Other assets | 47,170 | 40,500 |
Total assets | 385,746 | 445,402 |
Current liabilities: | ||
Payable to growers | 20,223 | 23,033 |
Trade accounts payable | 10,436 | 9,794 |
Accrued expenses | 51,795 | 42,063 |
Dividend payable | 20,330 | |
Other current liabilities | 11,000 | 11,000 |
Current portion of operating leases | 6,925 | 6,817 |
Current portion of long-term obligations and finance leases | 1,574 | 1,587 |
Total current liabilities | 101,953 | 114,624 |
Long-term liabilities: | ||
Borrowings pursuant to credit facilities, long-term | 1,200 | 37,700 |
Long-term operating leases, less current portion | 52,140 | 57,561 |
Long-term obligations and finance leases, less current portion | 4,447 | 5,553 |
Other long-term liabilities | 2,635 | 3,081 |
Total long-term liabilities | 60,422 | 103,895 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Common stock ($0.001 par value, 100,000 shares authorized; 17,732 (2022) and 17,686 (2021) shares issued and outstanding) | 18 | 18 |
Additional paid-in capital | 171,223 | 168,133 |
Noncontrolling interest | 1,015 | 1,368 |
Retained earnings | 51,115 | 57,364 |
Total shareholders' equity | 223,371 | 226,883 |
Total liabilities and shareholders' equity | $ 385,746 | $ 445,402 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
CONSOLIDATED BALANCE SHEETS | ||
Allowances of accounts receivable | $ 4,199 | $ 4,816 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 17,732 | 17,686 |
Common stock, shares outstanding | 17,732 | 17,686 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | |||
Net sales | $ 1,191,073 | $ 1,055,830 | $ 1,059,371 |
Cost of sales | 1,117,228 | 998,405 | 969,473 |
Gross profit | 73,845 | 57,425 | 89,898 |
Selling, general and administrative | 65,698 | 56,679 | 57,952 |
Expenses related to Mexican tax matters | 1,417 | 1,797 | |
Impairment and charges related to Florida facility closure | 959 | 9,162 | |
Gain on sale of Temecula packinghouse | (216) | (216) | (216) |
Operating income (loss) | 5,987 | (9,997) | 32,162 |
Interest income | 500 | 335 | 1,998 |
Interest expense | (1,686) | (798) | (877) |
Other income, net | 1,017 | 1,016 | 553 |
Recovery (loss) on reserve for FreshRealm note receivable and impairment of investment | 6,130 | (37,322) | |
Realized and unrealized net gain (loss) on Limoneira shares | (8,605) | 3,858 | (8,537) |
Income (loss) before income taxes and loss from unconsolidated entities | (2,787) | 544 | (12,023) |
Income tax benefit (provision) | (3,251) | (10,747) | 4,292 |
Net loss from unconsolidated entities | (564) | (1,719) | (6,110) |
Net loss | (6,602) | (11,922) | (13,841) |
Add: Net loss attributable to noncontrolling interest | 353 | 104 | 216 |
Net loss attributable to Calavo Growers, Inc. | $ (6,249) | $ (11,818) | $ (13,625) |
Calavo Growers, Inc.'s net loss per share: | |||
Basic | $ (0.35) | $ (0.67) | $ (0.78) |
Diluted | $ (0.35) | $ (0.67) | $ (0.78) |
Number of shares used in per share computation: | |||
Basic | 17,663 | 17,621 | 17,564 |
Diluted | 17,663 | 17,621 | 17,564 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] Cumulative effect adjustment | Retained Earnings [Member] | Noncontrolling Interest | Cumulative effect adjustment | Total |
Retained earnings | $ 923 | $ 923 | |||||
Beginning balance at Oct. 31, 2019 | $ 18 | $ 161,606 | $ 122,557 | $ 1,688 | $ 285,869 | ||
Beginning balance, shares at Oct. 31, 2019 | 17,595 | ||||||
Exercise of stock options and income tax benefit | 86 | 86 | |||||
Exercise of stock options and income tax benefit, shares | 2 | ||||||
Stock compensation expense | 4,487 | 4,487 | |||||
Restricted stock issued, shares | 64 | ||||||
Payments of minimum withholding taxes on net share settlement of equity awards | (1,179) | (1,179) | |||||
Dividend declared to shareholders | (20,343) | (20,343) | |||||
Avocados de Jalisco noncontrolling interest | (216) | (216) | |||||
Net loss attributable to Calavo Growers, Inc | (13,625) | (13,625) | |||||
Ending balance at Oct. 31, 2020 | $ 18 | 165,000 | 89,512 | 1,472 | 256,002 | ||
Ending balance, shares at Oct. 31, 2020 | 17,661 | ||||||
Exercise of stock options and income tax benefit | 47 | 47 | |||||
Exercise of stock options and income tax benefit, shares | 2 | ||||||
Stock compensation expense | 3,950 | 3,950 | |||||
Restricted stock issued, shares | 23 | ||||||
Payments of minimum withholding taxes on net share settlement of equity awards | (864) | (864) | |||||
Dividend declared to shareholders | (20,330) | (20,330) | |||||
Avocados de Jalisco noncontrolling interest | (104) | (104) | |||||
Net loss attributable to Calavo Growers, Inc | (11,818) | (11,818) | |||||
Ending balance at Oct. 31, 2021 | $ 18 | 168,133 | 57,364 | 1,368 | 226,883 | ||
Ending balance, shares at Oct. 31, 2021 | 17,686 | ||||||
Retained earnings | 57,364 | ||||||
Exercise of stock options and income tax benefit | 47 | 47 | |||||
Exercise of stock options and income tax benefit, shares | 2 | ||||||
Stock compensation expense | 3,139 | 3,139 | |||||
Restricted stock issued, shares | 44 | ||||||
Payments of minimum withholding taxes on net share settlement of equity awards | (96) | (96) | |||||
Avocados de Jalisco noncontrolling interest | (353) | (353) | |||||
Net loss attributable to Calavo Growers, Inc | (6,249) | (6,249) | |||||
Ending balance at Oct. 31, 2022 | $ 18 | $ 171,223 | $ 51,115 | $ 1,015 | 223,371 | ||
Ending balance, shares at Oct. 31, 2022 | 17,732 | ||||||
Retained earnings | $ 51,115 |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (PARENTHETICAL) - $ / shares | 12 Months Ended | |||
Dec. 14, 2022 | Oct. 29, 2021 | Oct. 31, 2021 | Oct. 31, 2020 | |
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | ||||
Dividend declared per share | $ 0.2875 | $ 1.15 | $ 1.15 | $ 1.15 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Cash Flows from Operating Activities: | |||
Net loss | $ (6,602) | $ (11,922) | $ (13,841) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 16,589 | 17,571 | 16,093 |
Non-cash operating lease expense | 20 | 83 | 176 |
Provision for losses on accounts receivable | 22 | ||
Net loss from unconsolidated entities | 564 | 1,719 | 6,110 |
Realized and unrealized net loss (gain) on Limoneira shares | 8,605 | (3,858) | 8,537 |
Impairment and non-cash charges related to closure of Florida facility | 317 | 9,748 | |
Recovery from reserve for FreshRealm note receivable and impairment of investment | (6,130) | 37,322 | |
Interest income on notes to FreshRealm | (1,732) | ||
Stock-based compensation expense | 3,139 | 3,950 | 4,487 |
Gain on sale of Temecula packinghouse | (216) | (216) | (216) |
Loss (gain) on disposal of property, plant, and equipment | 186 | (170) | 32 |
Deferred income taxes | (117) | (2,526) | (1,930) |
Effect on cash of changes in operating assets and liabilities: | |||
Accounts receivable, net | 19,850 | (15,024) | 1,859 |
Inventories | 1,837 | 412 | (4,206) |
Prepaid expenses and other current assets | (147) | 3,567 | (782) |
Advances to suppliers | (4,677) | (1,632) | 3,077 |
Income taxes receivable/payable | 8,128 | (933) | (8,115) |
Other assets | (4,961) | (7,831) | (1,871) |
Payable to growers | (2,809) | 11,687 | (2,117) |
Trade accounts payable, accrued expenses and other liabilities | 10,527 | 15,077 | (14,027) |
Net cash provided by operating activities | 50,233 | 13,572 | 28,878 |
Cash Flows from Investing Activities: | |||
Purchases of property, plant, and equipment | (9,769) | (11,438) | (11,343) |
Acquisition of SFFI, net of cash acquired of $623 | (18,396) | ||
Investment in unconsolidated entities | (1,477) | ||
Loan to Agricola Belher | (3,500) | ||
Proceeds received from Limoneira stock sales | 18,450 | ||
Proceeds received from FreshRealm Separation Agreement recovery | 6,000 | ||
Proceeds received on repayment of infrastructure loan | 900 | ||
Infrastructure advance to tomato growers | (1,326) | (715) | |
Net cash provided by (used in) investing activities | 8,681 | (9,364) | (31,931) |
Cash Flows from Financing Activities: | |||
Payment of dividend to shareholders | (20,330) | (20,343) | (19,354) |
Proceeds from revolving credit facility | 267,200 | 334,850 | 236,500 |
Payments on revolving credit facility | (303,700) | (317,700) | (215,950) |
Payments of minimum withholding taxes on net share settlement of equity awards | (96) | (864) | (1,179) |
Proceeds from sale leaseback | 240 | ||
Payments on long-term obligations and finance leases | (1,996) | (1,398) | (968) |
Proceeds from stock option exercises | 47 | 47 | 86 |
Net cash used in financing activities | (58,635) | (5,408) | (865) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 279 | (1,200) | (3,918) |
Cash, cash equivalents and restricted cash, beginning of period | 2,855 | 4,055 | 7,973 |
Cash, cash equivalents and restricted cash, end of period | 3,134 | 2,855 | 4,055 |
Supplemental Information: | |||
Interest | 1,482 | 687 | 878 |
Income taxes | 2,601 | 3,047 | 5,470 |
Noncash Investing and Financing Activities: | |||
Right of use assets obtained in exchange for new financing lease obligations | 611 | 1,430 | 529 |
Settlement of Agricola Belher infrastructure advance offset against payable to growers | 1,060 | 2,761 | |
Property, plant, and equipment included in trade accounts payable and accrued expenses | $ 160 | $ 312 | $ 568 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASHFLOWS (Parenthetical) $ in Thousands | 12 Months Ended |
Oct. 31, 2020 USD ($) | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | |
Cash acquired | $ 623 |
Description of the business
Description of the business | 12 Months Ended |
Oct. 31, 2022 | |
Description of the business | |
Description of the business | 1. Description of the business Business Calavo Growers, Inc. (referred to in this report as “Calavo”, the “Company”, “we’, “us” or “our”), is a global leader in the avocado industry and a provider of value-added fresh food. Our expertise in marketing and distributing avocados, prepared avocado products, and other perishable foods allows us to deliver a wide array of fresh and prepared food products to retail grocery, foodservice, club stores, mass merchandisers, food distributors and wholesalers on a worldwide basis. We procure avocados from California, Mexico and other growing regions around the world. Through our various operating facilities, we (i) sort, pack, and/or ripen avocados, tomatoes and/or Hawaiian grown papayas, (ii) create, process and package a portfolio of healthy fresh foods including fresh-cut fruit and vegetables, and prepared foods including sandwiches, salads, parfaits and ready-to-eat snack items among other products and (iii) process and package guacamole and salsa. We distribute our products both domestically and internationally and beginning in the third quarter of fiscal 2022 we report our operations in different business segments: Grown and Prepared. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Oct. 31, 2022 | |
Basis of Presentation and Significant Accounting Policies | |
Basis of Presentation and Significant Accounting Policies | 2. Basis of Presentation and Significant Accounting Policies The accompanying consolidated financial statements were prepared in accordance with accounting principles generally accepted in the U.S. Our consolidated financial statements include the accounts of Calavo Growers, Inc. and our wholly owned subsidiaries, Calavo de Mexico S.A. de C.V. (Calavo de Mexico), Calavo Growers de Mexico, S. de R.L. de C.V. ( Calavo Growers de Mexico), Maui Fresh International, Inc. (Maui), Hawaiian Sweet, Inc. (HS), CW Hawaii Pride, LLC (HP), Calavo Salsa Lisa, LLC (CSL), Renaissance Food Group, LLC (RFG), and Avocados de Jalisco, S.A.P.I. de C.V. (Avocados de Jalisco), in which we have an 83% ownership interest. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Among the significant estimates affecting the financial statements are those related to valuation allowances for valuation allowances for accounts and notes receivable, goodwill, grower advances, inventories, long-lived assets, valuation of and estimated useful lives of identifiable intangible assets, stock-based compensation, promotional allowances and income taxes. On an ongoing basis, management reviews its estimates based upon currently available information. Actual results could differ materially from those estimates. Cash and Cash Equivalents We consider all highly liquid financial instruments purchased with an original maturity date of three months or less to be cash equivalents. The carrying amounts of cash and cash equivalents approximate their fair values. Restricted Cash We have $1.0 million in restricted cash in our subsidiary Calavo de Mexico. This cash is restricted due to the 2013 tax assessment. In November 2022, this restriction was lifted. See Note 7. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist primarily of non-trade receivables, infrastructure advances and prepaid expenses. Non-trade receivables were $4.8 million and $5.3 million at October 31, 2022 and 2021. Included in non-trade receivables are $1.8 million and $1.7 million related to the current portion of non-CDM Mexican IVA (i.e. value-added) taxes at October 31, 2022 and 2021 (See Note 15). Infrastructure advances are discussed below. Prepaid expenses totaling Accounts Receivable Trade accounts receivable are reported at amounts due from customers, net of an allowance for doubtful accounts and customer deductions accounted for as variable consideration. The Company performs credit evaluations of customers and evaluates the need for allowances for potential credit losses based on historical experience, as well as current and expected general economic conditions. The total allowance for estimated uncollectable accounts receivable balances and customer deductions were $4.2 million and $4.8 million as of October 31, 2022 and 2021. Inventories Inventories are stated at the lower of cost or net realizable value. Cost is computed on a monthly weighted-average basis, which approximates the first-in, first-out method; market is based upon estimated replacement costs. Costs included in inventory primarily include the following: fruit, picking and hauling, overhead, labor, materials and freight. Property, Plant, and Equipment Property, plant, and equipment are stated at cost and depreciated over their estimated useful lives using the straight-line method. Leasehold improvements are stated at cost and amortized over the lesser of their estimated useful lives or the term of the lease, using the straight-line method. Useful lives are as follows: buildings and improvements - . Significant repairs and maintenance that increase the value or extend the useful life of our fixed asset are capitalized. On-going maintenance and repairs are charged to expense. Goodwill and Acquired Intangible Assets Goodwill, defined as unidentified asset(s) acquired in conjunction with a business acquisition, is tested for impairment on an annual basis and between annual tests whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Goodwill is tested at the reporting unit level, which is defined as an operating segment or one level below the operating segment. We perform an assessment of goodwill for impairment on an annual basis, and between annual tests whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. To the extent the carrying amount of the reporting unit’s allocated goodwill exceeds the unit’s fair value, we recognize an impairment of goodwill for the excess up to the amount of goodwill of that reporting unit. As a result of the Company's operating segment realignment, the composition of its reporting units for the evaluation of goodwill impairment was changed. RFG reporting unit goodwill is now included within the Prepared reporting unit. Therefore, the goodwill of $24.7 million, which was previously recorded within the RFG reporting unit, is now within our Prepared segment and $4.0 million which was previously within the Fresh reporting unit, is now within our Grown segment. Prior to the change in its reporting unit, the Company tested goodwill for impairment at the previous reporting unit, which did not result in any impairment charge. In fiscal 2022 and 2021, the Company’s estimated fair value significantly exceeded its carrying value. The fair value of the Company’s reporting units is determined using a combination of valuation techniques, including a discounted cash flow methodology. To corroborate the discounted cash flow analysis, a market approach is utilized using observable market data such as comparable companies in similar lines of business that are publicly traded. The Company concluded based on its quantitative assessment that no goodwill impairment existed in the fiscal years ended October 31, 2022 and 2021. Goodwill impairment testing requires significant judgment and management estimates, including, but not limited to, the determination of (i) the number of reporting units, (ii) the goodwill and other assets and liabilities to be allocated to the reporting units and (iii) the fair values of the reporting units which includes forecasted cash flow. The estimates and assumptions described above, along with other factors such as discount rates, will significantly affect the outcome of the impairment tests and the amounts of any resulting impairment losses. Long-lived Assets Long-lived assets, including fixed assets and intangible assets (other than goodwill), are continually monitored and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of any such asset may not be recoverable. The determination of recoverability is based on an estimate of undiscounted cash flows expected to result from the use of an asset and its eventual disposition. The estimate of undiscounted cash flows is based upon, among other things, certain assumptions about future operating performance, growth rates and other factors. Estimates of undiscounted cash flows may differ from actual cash flows due to, among other things, technological changes, economic conditions, changes to the business model or changes in operating performance. If the sum of the undiscounted cash flows (excluding interest) is less than the carrying value, an impairment loss will be recognized, measured as the amount by which the carrying value exceeds the fair value of the asset. For fiscal years 2022 and 2021, we performed our annual assessment of long-lived assets and determined that Investments We account for non-marketable investments using the equity method of accounting if the investment gives us the ability to exercise significant influence over, but not control, an investee. Significant influence generally exists when we have an ownership interest representing between 20% and 50% of the voting stock of the investee. Under the equity method of accounting, investments are stated at initial cost and are adjusted for subsequent additional investments and our proportionate share of earnings or losses and distributions. In December 2014, Calavo formed a wholly owned subsidiary Calavo Growers De Mexico, S. de R.L. de C.V. (Calavo Sub). In July 2015, Calavo Sub entered into a Shareholder Agreement with Grupo Belo del Pacifico, S.A. de C.V., (Belo) a Mexican company owned by Agricola Belher, and Agricola Don Memo, S.A. de C.V. (Don Memo). Don Memo, a Mexican corporation formed in July 2013, is engaged in the business of owning and improving land in Jalisco, Mexico for the growing of tomatoes and other produce and the sale and distribution of tomatoes and other produce. Belo and Calavo Sub have an equal one-half ownership interest in Don Memo. Pursuant to a management service agreement, Belo, through its officers and employees, shall have day-to-day power and authority to manage the operations. This investment contribution represent Calavo Sub’s ownership in Don Memo, which is included in investment in unconsolidated entities on our balance sheet. We use the equity method to account for this investment. As of October 31, 2022 and 2021, we have an investment of Marketable Securities Our marketable securities consist of our investment in Limoneira Company (Limoneira) stock. These securities are considered available for sale securities based on management’s intent with respect to such securities and are carried at fair value as determined from quoted market prices. On October 27, 2022, we sold 1,677,299 shares of Limoneira common stock for gross proceeds of approximately $18.5 million. The net proceeds thereof after payment of commissions and expenses was used by the Company to pay down borrowings on its credit facility with Bank of America, as administrative agent, and the other lenders thereto. Contemporaneously with such sale, Bank of America, as administrative agent, released its lien on such shares in accordance with terms of the Credit Facility and the related loan documents. For year ended October 31, 2022, million in our consolidated statements of operations. Limoneira’s stock price at October 31, 2021, and 2020 equaled $16.13 per share, and $13.83 per share. Our shares of Limoneira stock, totaling 1,677,299, were revalued to $16.13 per share at October 31, 2021 as a result, we recorded a gain of $3.9 million and a loss of $8.5 million for the year ended October 31, 2021 and 2020 in our consolidated statements of operations. Advances to Suppliers We advance funds to third-party growers primarily in Mexico for various farming needs. Typically, we obtain collateral (i.e. fruit, fixed assets, etc.) that approximates the value at risk, prior to making such advances. We continuously evaluate the ability of these growers to repay advances in order to evaluate the possible need to record an allowance. No such allowance was required at October 31, 2022 and 2021. Pursuant to our distribution agreement, which was amended in fiscal 2011, with Agricola Belher (Belher) of Mexico, a producer of fresh vegetables, primarily tomatoes, for export to the U.S. market, Belher agreed, at their sole cost and expense, to harvest, pack, export, ship, and deliver tomatoes exclusively to our Company, primarily our Arizona facility. In exchange, we agreed to sell and distribute such tomatoes, make advances to Belher for operating purposes, provide additional advances as shipments are made during the season (subject to limitations, as defined), and return the proceeds from such tomato sales to Belher, net of our commission and aforementioned advances. These advances will be collected through settlements by the end of each year. For fiscal 2022 and 2021, we agreed to advance Similar to Belher, we make advances to Don Memo for operating purposes, provide additional advances as shipments are made during the season, and return the proceeds from such tomato sales to Don Memo, net of our commission and aforementioned advances. As of October 31, 2022 and 2021, we have total advances of $7.0 million and $4.2 million to Don Memo, which is recorded in advances to suppliers, offset by tomato liabilities from the sales of tomatoes per the tomato marketing agreement. We have entered into a distribution agreement with a new tomato grower Exportadora Silvalber (Silvalber). We made Infrastructure Advances Pursuant to our infrastructure agreements, we make advances to be used solely for the acquisition, construction, and installation of improvements to and on certain land owned/controlled by Belher and Don Memo, as well as packing line equipment. In October 2020, we entered into an infrastructure loan agreement with Don Memo for $2.4 million secured by Don Memo’s property and equipment. This infrastructure loan accrues interest at . In October 2020, we advanced million related to this loan agreement. We advanced an additional million in other assets). As of October 31, 2022, we have a total outstanding balance at October 31, 2022 of In August 2018, we entered into an amended infrastructure loan agreement with Belher and advanced $3.0 million. This amount shall be paid back in annual installments of . Loans prior to this amended agreement accrued interest at Libor plus million per year). This portion of the infrastructure loan has been paid in full as of October 31, 2022, of which million was offset against the grower payable due to Belher. In July 2021, we made a bridge loan of $3.5 million to Belher. This loan is secured by certain farmland in Mexico and accrues interest at 10%. In the first quarter of fiscal 2022, this loan was amended to be due with installments of million on July 31, 2024. As part of this amended loan agreement, we can withhold payments on both the infrastructure advances and the bridge loan through the netting against the grower payable due to Belher. For the year ended October 31, 2022, we withheld Accrued Expenses Included in accrued expenses are liabilities related to the receipt of goods and/or services for which an invoice has not yet been received. These totaled approximately $28.7 million and $32.6 million for the year ended October 31, 2022 and 2021. Revenue Recognition The Company recognizes revenue when obligations under the terms of a contract with its customer are satisfied; generally, this occurs with the transfer of control of its products. Revenue is measured as the amount of net consideration expected to be received in exchange for transferring products. Revenue from product sales is governed primarily by customer pricing and related purchase orders (“contracts”) which specify shipping terms and certain aspects of the transaction price including variable considerations such as rebates, discounts and other sales incentives. Contracts are at standalone pricing. The performance obligation in these contracts is determined by each of the individual purchase orders and the respective stated quantities, with revenue being recognized at a point in time when obligations under the terms of the agreement are satisfied. This generally occurs with the transfer of control of our products to the customer and the product is delivered. The Company's customers have an implicit and explicit right to return non-conforming products. A provision for payment discounts and product return allowances, which is estimated, is recorded as a reduction of sales in the same period that the revenue is recognized. Sales Incentives and Other Promotional Programs The Company routinely offers sales incentives and discounts through various regional and national programs to our customers and consumers. These programs include product discounts or allowances, product rebates, product returns, one-time or ongoing trade-promotion programs with customers and consumer coupon programs that require the Company to estimate and accrue the expected costs of such programs. The costs associated with these activities are accounted for as reductions to the transaction price of the Company’s products and are, therefore, recorded as reductions to gross sales at the time of sale. The Company bases its estimates of incentive costs on historical trend experience with similar programs, actual incentive terms per customer contractual obligations and expected levels of performance of trade promotions, utilizing customer and sales organization inputs. The Company maintains liabilities at the end of each period for the estimated incentive costs incurred but unpaid for these programs. Differences between estimated and actual incentive costs are generally not material and are recognized in earnings in the period such differences are determined. Reserves for product returns, accrued rebates and promotional accruals are included in the consolidated balance sheets as part of accounts receivable or accrued expenses. Principal vs. Agent Considerations We frequently enter into consignment arrangements with avocado and tomato growers and packers located outside of the U.S. and growers of certain perishable products in the U.S. We evaluate whether its performance obligation is a promise to transfer services to the customer (as the principal) or to arrange for services to be provided by another party (as the agent) using a control model. This evaluation determined that the Company is in control of establishing the transaction price, managing all aspects of the shipments process and taking the risk of loss for delivery, collection, and returns. Based on the Company’s evaluation of the control model, it determined that all of the Company’s major businesses act as the principal rather than the agent within their revenue arrangements and such revenues are reported on a gross basis. Customers We sell to retail grocery, foodservice, club stores, mass merchandisers, food distributors and wholesale customers. Our top of our consolidated net sales in fiscal years 2022, 2021 and 2020. Sales to our largest customer, Kroger (including its affiliates), represented approximately of net sales in fiscal years 2022, 2021 and 2020. Shipping and Handling We include shipping and handling fees billed to customers in net sales. Amounts incurred by us for freight are included in cost of goods sold. Promotional Allowances We provide for promotional allowances at the time of sale, based on our historical experience. Our estimates are generally based on evaluating the historical relationship between promotional allowances and gross sales. The derived percentage is then applied to the current period’s sales revenues in order to arrive at the appropriate debit to sales allowances for the period. The offsetting credit is made to accrued expenses. When certain amounts of specific customer accounts are subsequently identified as promotional, they are written off against this allowance. Actual amounts may differ from these estimates and such differences are recognized as an adjustment to net sales in the period they are identified. Loss on Reserve for FreshRealm Note Receivable and Impairment of Investment At the beginning of fiscal year 2020, we had a note receivable from FreshRealm totaling $34.5 million which has been fully reserved during fiscal 2020. In July 2021, FreshRealm paid Calavo the Loan Payoff Amount per the Separation Agreements with FreshRealm (See Note 16) of $6.0 million, and we recorded the receipt as a recovery of the reserve for collectability of the FreshRealm note receivable on the statement of operations. Therefore, the notes receivable mentioned above, have been deemed paid in full. Consignment Arrangements We frequently enter into consignment arrangements with avocado and tomato growers and packers located outside of the U.S. and growers of certain perishable products in the U.S. Although we generally do not take legal title to these avocados and perishable products, we do assume responsibilities (principally assuming credit risk, inventory loss and delivery risk, and pricing risk) that are consistent with acting as a principal in the transaction. Accordingly, the accompanying financial statements include sales and cost of sales from the sale of avocados and perishable products procured under consignment arrangements. Amounts recorded for each of the fiscal years ended October 31, 2022, 2021 and 2020 in the financial statements pursuant to consignment arrangements are as follows (in thousands): 2022 2021 2020 Sales $ 59,748 $ 52,287 $ 64,922 Cost of Sales 53,238 45,945 57,554 Gross Profit $ 6,510 $ 6,342 $ 7,368 Advertising Expense Advertising costs are expensed when incurred and are generally included as a component of selling, general and administrative expense. Such costs were approximately $0.6 million, $0.4 million and $0.4 million for fiscal years 2022, 2021, and 2020. Research and Development Research and development costs are expensed as incurred and are generally included as a component of selling, general and administrative expense. Total research and development costs for fiscal year 2022, 2021 and 2020 was approximately $0.1 million, $0.3 million and $0.7 million. Restructuring Costs For the year ended October 31, 2022 and 2021, we recorded $2.8 million and $0.9 million of consulting expenses (included in selling, general and administrative expenses) related to an enterprise-wide strategic business review conducted for the purpose of restructuring to improve the profitability of the organization and efficiency of our operations. We also recorded $2.0 million and $0.6 million for the years ended October 31, 2022 and 2021, respectively, of management recruiting and severance costs related to this restructuring initiative. Other Income Included in other income is dividend income totaling $0.8 million, $0.6 million, and $0.6 million for fiscal years 2022, 2021 and 2020. See Note 8 for related party disclosure related to other income. Income Taxes We account for deferred tax liabilities and assets for the future consequences of events that have been recognized in our consolidated financial statements or tax returns. Measurement of the deferred items is based on enacted tax laws. In the event the future consequences of differences between financial reporting bases and tax bases of our assets and liabilities result in a deferred tax asset, we perform an evaluation of the probability of being able to realize the future benefits indicated by such asset. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion or all of the deferred tax asset will not be realized. We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. As a multinational corporation, we are subject to taxation in many jurisdictions, and the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in various taxing jurisdictions. If we ultimately determine that the payment of these liabilities will be unnecessary, the liability will be reversed and we will recognize a tax benefit during the period in which it is determined the liability no longer applies. Conversely, we record additional tax charges in a period in which it is determined that a recorded tax liability is less than the ultimate assessment is expected to be. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability for U.S. or foreign taxes may be materially different from management’s estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities. Basic and Diluted Net Loss per Share Basic earnings per share is calculated using the weighted-average number of common shares outstanding during the period without consideration of the dilutive effect of stock options and contingent consideration. Diluted earnings per common share is calculated using the weighted-average number of common shares outstanding during the period after consideration of the dilutive effect of stock options and the effect of contingent consideration shares. Basic and diluted net loss per share is calculated as follows (U.S. dollars in thousands, except per share data): Year ended October 31, 2022 2021 2020 Numerator: Net loss attributable to Calavo Growers, Inc. $ (6,249) $ (11,818) $ (13,625) Denominator: Weighted average shares – Basic 17,663 17,621 17,564 Effect of dilutive securities – Restricted stock/units/options (1) — — — Weighted average shares – Diluted 17,663 17,621 17,564 Net loss per share attributable to Calavo Growers, Inc: Basic $ (0.35) $ (0.67) $ (0.78) Diluted $ (0.35) $ (0.67) $ (0.78) (1) For the year ended October 31, 2022, 2021 and 2020, approximately 82,000 shares, 42,000 shares, and 55,000 shares of common stock equivalents were excluded in the computation of diluted net loss per share, as the effect would be anti-dilutive since the Company reported a net loss. Stock-Based Compensation We account for awards of equity instruments issued to employees under the fair value method of accounting and recognize such amounts in our statements of operations. We measure compensation cost for all stock-based awards at fair value on the date of grant and recognize compensation expense in our consolidated statements of operations over the service period that the awards are expected to vest. For the years ended October 31, 2022, 2021 and 2020, we recognized compensation expense of $3.1 million, $4.0 million, and $4.5 million related to stock-based compensation (See Note 12). The value of the stock-based compensation was determined from quoted market prices at the date of the grant. Foreign Currency Translation and Remeasurement Our foreign operations are subject to exchange rate fluctuations and foreign currency transaction costs. The functional currency of our foreign subsidiaries is the United States dollar. As a result, monetary assets and liabilities are translated into U.S. dollars at exchange rates as of the balance sheet date and non-monetary assets, liabilities and equity are translated at historical rates. Sales and expenses are translated using a weighted-average exchange rate for the period. Gains and losses resulting from those remeasurements are included in income. Gains and losses resulting from foreign currency transactions are also recognized in income. Total foreign currency translation gains for fiscal 2021, net of losses, was Fair Value of Financial Instruments We believe that the carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and short-term borrowings approximates fair value based on either their short-term nature or on terms currently available to the Company in financial markets. Due to current market rates, we believe that our fixed-rate long-term obligations and finance leases have nearly the same fair value and carrying value of approximately Derivative Financial Instruments We were not a party to any material derivative instruments during the fiscal year. It is currently our intent not to use derivative instruments for speculative or trading purposes. Additionally, we do not use any hedging or forward contracts to offset market volatility. Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes," which amends and simplifies the accounting for income taxes by removing certain exceptions and providing new guidance to reduce complexity in certain aspects of the current guidance. This guidance was adopted by the Company during the first quarter of 2022 and did not impact the Company’s financial statements or related disclosures. Noncontrolling Interest The following tables reconcile shareholders’ equity attributable to noncontrolling interest related to Avocados de Jalisco (in thousands). Year ended Year ended Avocados de Jalisco noncontrolling interest October 31, 2022 October 31, 2021 Noncontrolling interest, beginning $ 1,368 $ 1,472 Net loss attributable to noncontrolling interest of Avocados de Jalisco (353) (104) Noncontrolling interest, ending $ 1,015 $ 1,368 |
Inventories
Inventories | 12 Months Ended |
Oct. 31, 2022 | |
Inventories | |
Inventories | 3. Inventories Inventories consist of the following (in thousands): October 31, 2022 2021 Fresh fruit $ 16,938 $ 17,648 Packing supplies and ingredients 14,176 13,088 Finished prepared foods 7,716 10,021 Total $ 38,830 $ 40,757 We assess the recoverability of inventories through an ongoing review of inventory levels in relation to sales and forecasts and product marketing plans. When the inventory on hand, at the time of the review, exceeds the foreseeable demand, the value of inventory that is not expected to be sold is written down. The amount of the write-down is the excess of historical cost over estimated realizable value. Once established, these write-downs are considered permanent adjustments to the cost basis of the excess inventory. The assessment of the recoverability of inventories and the amounts of any write-downs are based on currently available information and assumptions about future demand and market conditions. Demand for processed avocado products may fluctuate significantly over time, and actual demand and market conditions may be more or less favorable than our projections. In the event that actual demand is lower than originally projected, additional inventory write-downs may be required. On October 18, 2021, the Company announced the closure of Prepared’s food processing operations at its Green Cove Springs (near Jacksonville), Florida facility, as part of its Project Uno profit improvement program. As of November 15, 2021, Prepared’s portion of the Green Cove facility has ceased operations. The Company’s Grown avocado operations at this facility will continue in operation and are not affected. We wrote down inventory related to this closure of $0.6 million as of October 31, 2021. See Note 18 for further information. |
Property, Plant, and Equipment
Property, Plant, and Equipment | 12 Months Ended |
Oct. 31, 2022 | |
Property, Plant, and Equipment | |
Property, Plant, and Equipment | 4. Property, Plant, and Equipment Property, plant, and equipment consist of the following (in thousands): October 31, 2022 2021 Land $ 11,008 $ 11,008 Buildings and improvements 45,733 46,133 Leasehold improvements 19,030 25,114 Equipment 121,441 115,942 Information systems - hardware and software 11,920 11,598 Construction in progress 8,307 5,802 217,439 215,597 Less accumulated depreciation and amortization (104,129) (97,317) $ 113,310 $ 118,280 Depreciation expense was $15.0 million, $14.5 million and $13.9 million for fiscal years 2022, 2021, and 2020. Included in property, plant, and equipment are finance leases. Amortization of finance leases was In February 2016, the FASB issued ASU 2016-02, Leases , and has subsequently issued several supplemental and/or clarifying ASU's (collectively, "Topic 842"), which requires a dual approach for lease accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases result in the lessee recognizing a right of use asset and a corresponding lease liability. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use asset, and for operating leases, the lessee would recognize lease expense on a straight-line basis. See Note 17. On October 18, 2021, the Company announced the closure of Prepared’s food processing operations at its Green Cove Springs (near Jacksonville), Florida facility, as part of its Project Uno profit improvement program. As of November 15, 2021, Prepared’s portion of the Green Cove facility has ceased operations. The Company’s Grown avocado operations at this facility will continue in operation and are not affected. The closure resulted in a reduction of 140 employees, impairment of leasehold improvements, writedowns of inventory and other assets, and certain cash expenditures for the relocation of machinery and equipment and the closure of the leased facilities. See Note 18 for further information. |
Other Assets and Intangibles
Other Assets and Intangibles | 12 Months Ended |
Oct. 31, 2022 | |
Other Assets and Intangibles | |
Other assets and Intangibles | 5. Other Assets and Intangibles Other assets consist of the following (in thousands): October 31, October 31, 2022 2021 Mexican IVA (i.e. value-added) taxes receivable $ 43,625 $ 37,493 Infrastructure advances to Agricola Belher 1,241 1,641 Bridge loan to Agricola Belher 1,700 — Other 604 1,366 Total $ 47,170 $ 40,500 The intangible assets consist of the following (in thousands): October 31, 2022 October 31, 2021 Weighted- Gross Net Gross Net Average Carrying Accum. Book Carrying Accum. Book Useful Life Value Amortization Value Value Amortization Value Customer list/relationships 8 years $ 17,340 $ (11,373) $ 5,967 $ 17,340 $ (9,989) $ 7,351 Trade names 8 years 4,060 (3,100) 960 4,060 (2,980) 1,080 Trade secrets/recipes 9 years 630 (626) 4 630 (567) 63 Brand name intangibles indefinite 275 — 275 275 — 275 Intangibles, net $ 22,305 $ (15,099) $ 7,206 $ 22,305 $ (13,536) $ 8,769 We recorded amortization expense of approximately $1.6 million, $1.6 million, and $1.1 million for fiscal years 2022, 2021, and 2020. We anticipate recording amortization expense of approximately 202 |
Revolving Credit Facilities
Revolving Credit Facilities | 12 Months Ended |
Oct. 31, 2022 | |
Revolving Credit Facilities | |
Revolving Credit Facilities | 6. Revolving Credit Facilities We have a revolving credit facility (the “Credit Facility”) with Bank of America, N.A. (Bank of America) as administrative agent and Merrill Lynch, Pierce, Fenner & Smith Inc. as joint lead arranger and sole bookrunner, and Farm Credit West (FCW), as joint lead arranger. Borrowings under the Credit Facility are at the Company’s discretion at a BSBY (Bloomberg Short-Term Bank Yield Index) Daily Floating Rate plus applicable margin or a base rate loan plus applicable margin. The applicable margin is based on the Company’s Consolidated Leverage Ratio (as defined in the Credit Facility) and can range from 1.25% to 1.75% for BSBY loans and 0.25% to 0.75% for Base Rate Loans. The Credit Facility also includes a commitment fee on the unused commitment amount at a rate per annum of 0.15%. The Credit Facility contains customary affirmative and negative covenants for agreements of this type, including the following financial covenants applicable to the Company and its subsidiaries on a consolidated basis: (a) a quarterly consolidated leverage ratio of not more than 2.50 to 1.00 and (b) a quarterly consolidated fixed charge coverage ratio of not less than 1.20 to 1.00. The Credit Facility also contains customary events of default. If any event of default occurs and is continuing, Bank of America may take the following actions: (a) declare the commitment of each lender to make loans and any obligation of the Issuer to make credit extensions to be terminated; (b) declare the unpaid principal amount of all outstanding loans, all interest, and all other amounts to be immediately due and payable; (c) require that Calavo cash collateralize the obligations; and (d) exercise on behalf of itself, the lenders and the letter of credit issuers under the Credit Facility all rights and remedies available to it. On January 29, 2021, we entered into the Third Amendment to our Credit Facility, which amendment, among other things, provides for a five-year extension of the maturity date to January 29, 2026, a $20 million increase in the revolving commitment to $100 million (from $80 million) (for a total facility size of $150 million if the $50 million accordion is exercised, up from a total size of $130 million), and a 25 basis point increase in the interest rate. On December 1, 2021, we entered into the Fourth and Fifth Amendments to our Credit Facility, which amendments, among other terms, added CDM as a guarantor, increased the interest rate by 50 basis points required that we pledge our Limoneira shares as collateral (in addition to the general business assets of the Company already securing the Credit Facility), added a new financial covenant testing the minimum Consolidated EBITDA on a cumulative monthly basis for the period January 2022 through and including June 2022, and replaced LIBOR as the reference interest rate with the BSBY Daily Floating Rate. As of January 31, 2022, the Company was not in compliance with the cumulative monthly minimum Consolidated EBITDA covenant, and the Consolidated Leverage Ratio (CLR) covenants. On March 14, 2022, we entered into the Sixth Amendment to our Credit Facility, which amendment waived such non-compliance and included the following terms: ● The interest rate was increased to BSBY plus 3.0% , until the first business day of the month after we certify that no default or event of default exists for the period ended July 31, 2022, after which point the interest rate would range between BSBY plus 1.25% to 1.75% based on our CLR. ● The total facility size was reduced from $100 million to $80 million ● Availability would be based on a borrowing base consisting of the sum of eligible accounts receivable (80%), eligible inventory (50%), and Limoneira shares (60%), less reserves including grower payables; and ● The FCCR covenant was amended (i) to 1.20 to 1.00 and (ii) to calculate monthly and cumulatively starting with the quarter ended April 30, 2022, which calculation converts to a quarterly calculation of trailing 12 month figures starting with the period ending October 31, 2022. On November 1, 2022, we entered into a Seventh Amendment to our Credit Facility with principal terms as follows: ● The FCCR covenant, only for the period ending October 31, 2022, was modified to 1.00 to 1.00; and ● We were permitted to declare cash dividends so long as (i) after giving effect to any such dividend a new Consolidated Dividend Adjusted Fixed Charge Coverage Ratio is not less than 1.20 to 1.00 and (ii) any such cash dividends are paid in the same fiscal quarter in which they are declared. Notwithstanding the foregoing restriction, we may declare and make a dividend payment in an amount not to exceed $5,200,000 on or before January 31, 2023. As of October 31, 2022, we were in compliance with the financial covenants, and we expect to remain in compliance. As of October 31, 2022, approximately $29.9 million was available for borrowing, based on our borrowing base calculation discussed above. We have a letter of credit balance of million as of October 31, 2022, that lowers the amount available per our Credit Facility. The weighted-average interest rate under the Credit Facility was |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Oct. 31, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | 7. Commitments and Contingencies Commitments and guarantees We lease facilities and certain equipment under non-cancelable leases expiring at various dates through 2031. We are committed to make minimum cash payments under these agreements as of October 31, 2022. See Note 17 for additional details on the type of lease agreements. We indemnify our directors and have the power to indemnify each of our officers, employees and other agents, to the maximum extent permitted by applicable law . Mexico tax audits We conduct business both domestically and internationally and, as a result, one or more of our subsidiaries files income tax returns in U.S. federal, U.S. state and certain foreign jurisdictions. Accordingly, in the normal course of business, we are subject to examination by taxing authorities, primarily in Mexico and the United States. 2011 Assessment On June 16, 2021 Calavo reached a settlement agreement with the Ministry of Finance and Administration of the government of the State of Michoacan, Mexico (MFM) regarding a 2011 Assessment of approximately $2.2 billion Mexican pesos related to income tax, flat rate business tax and value added tax. Calavo agreed to pay approximately $47.8 million Mexican pesos (approximately $2.4 million USD) as a full and final settlement of all taxes, fines, and penalties. 2013 Assessment In January 2017, we received preliminary observations from the Servicio de Administracion Tributaria in Mexico (the “Mexican Tax Administrative Service” or “SAT”) related to an audit for fiscal year 2013 outlining certain proposed adjustments primarily related to intercompany funding, deductions for services from certain vendors/suppliers and IVA. We provided a written rebuttal to these preliminary observations during our second fiscal quarter of 2017. During the period from our third fiscal quarter of 2017 through our third fiscal quarter of 2018. As a result, in July 2018, the SAT’s local office in Uruapan issued to Calavo de Mexico (“CDM”) a final tax assessment (the “2013 Assessment”) totaling approximately $2.6 billion Mexican pesos (which includes annual adjustments for inflation, and equals approximately $131.3 million USD at October 31, 2022) related to income tax, flat rate business tax, and value added tax, related to this fiscal 2013 tax audit. This amount has been adjusted for inflation as of October 31, 2022 to the amount of $3.08 billion Mexican pesos (approximately $151.5 million USD). Additionally, the tax authorities have determined that we owe our employees profit-sharing liability, totaling approximately $118 million Mexican pesos (approximately $6.0 million USD at October 31, 2022). In August 2018, we filed an Administrative Appeal on the 2013 Assessment, appealing our case to the SAT’s central legal department in Michoacan. On June 25, 2021, we became aware that the Administrative Appeal had been resolved by the SAT against CDM on March 12, 2021, and that we had allegedly failed to timely respond to and challenge the SAT’s notification of such resolution, therefore rendering the 2013 Assessment as definitive. Consequently, the SAT placed liens on the fixed assets of CDM, with a net book value of approximately $26 million USD, and on bank accounts of CDM totaling approximately $1 million USD in order to guaranty the 2013 Assessment. Based on legal counsel from our tax advisory firm, we and our tax advisory firm have concluded that the March notification was not legally communicated. On August 18, 2021, we filed an Administrative Reconsideration (the Reconsideration) before the Central Legal Department of the SAT located in Mexico City, asserting that the resolution in March of the Administrative Appeal was wrongly concluded, in particular with respect to the following matters: o Failure to recognize CDM as a “maquiladora” o Considering the Company to have a permanent establishment in Mexico, o Including fruit purchase deposits transferred by the Company to CDM as taxable, o Application of 16% IVA tax to fruit purchase deposits; and o Imposing double-taxation on the fruit purchase transactions On August 20, 2021 we filed an Annulment Suit (the Annulment Suit) with the Federal Tax Court, which among other things, strongly contends that the notifications made by the SAT to CDM and its designated advisors of the resolution of the Administrative Appeal in March 2021 were not legally communicated. In addition, the Annulment Suit asserts the same matters central to the Reconsideration, as described above, as wrongly concluded in the resolution of the Administrative Appeal. On September 22, 2021, we had an initial in-person meeting with the SAT in Mexico City to formally present and discuss the Reconsideration. The SAT agreed to review our Reconsideration in more detail; however, on January 3, 2022, the SAT formally rejected our request for the Reconsideration. In response to this rejection, on January 21, 2022, we filed an injunction suit with a federal district court seeking to nullify the arguments against the Reconsideration made by the SAT on constitutional grounds. On February 4, 2022, we had a follow-up meeting with the SAT in Mexico City to begin a dialog with the objective of reaching a settlement of the 2013 Assessment. The SAT agreed in principle to continue this dialog, but requested that we provide a financial guaranty to secure the related tax as a pre-requisite to these discussions. On February 25, 2022, we filed an injunction to challenge the SAT’s response issued to the Reconsideration. This would allow time to continue the discussions with SAT at the administrative level and would give SAT the legal basis to issue a new resolution. This injunction suit represents a further opportunity for a Court of Law to analyze this matter from a constitutional perspective. The injunction suit was admitted for analysis by the District Court, however, SAT filed a complaint (queja) against the ruling allowing CDM to file an extension of the injunction suit. This complaint was filed by SAT to challenge the admission and analysis of the injunction suit; this complaint was decided by the Circuit Courts in October against the SAT complaint and the court will start the analysis of injunction in the following months. On March 4, 2022, the Annulment Suit was formally accepted by the Federal Tax Court, which simultaneously granted a provisional suspension of the collections proceedings by the SAT. The acceptance by the court of the Annulment Suit renders the 2013 Assessment as non-definitive, until such time as the suit is resolved. On March 10, 2022, we met with the SAT and offered an Administrative Guaranty ( Embargo en Via Administrativa) , On April 27, 2022, the SAT provided a Positive Compliance Opinion to CDM, and consequently the Tax Authority renewed the VAT Certification to CDM. These two resolutions signal a positive development on the Tax controversies in Mexico. On October 10, 2022, the Tax Court ruled in favor of CDM granting the definitive suspension, accepting the Administrative Guaranty and forcing the SAT to remove all liens placed on CDM fixed assets and bank accounts. These liens were removed in November 2022. The Court also recognized that the While we continue to believe that the 2013 Assessment is completely without merit, and that we will prevail on the Annulment Suit in the Tax Court, and we have had court rulings in favor of CDM, we also believe that it is in the best interest of CDM and the Company to settle the 2013 Assessment as quickly as possible. Furthermore, we believe that the above actions taken by CDM will encourage the SAT to agree to reach a settlement. In accordance with our cumulative probability analysis on uncertain tax positions, our recent settlements made by the SAT in other cases, the 2011 Assessment settlement reached by CDM with the MFM, and the value of CDM assets, we recorded a provision of $11 million USD in the third quarter of fiscal 2021, as a discrete item in Income Tax Provision. The provision includes estimated penalties, interest and inflationary adjustments. We believe that this provision remains appropriate as of October 31, 2022 based on our cumulative probability analysis. We incurred Litigation From time to time, we are also involved in litigation arising in the ordinary course of our business that we do not believe will have a material adverse impact on our financial statements. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Oct. 31, 2022 | |
Related-Party Transactions | |
Related-Party Transactions | 8. Related-Party Transactions Board of Directors Certain members of our Board of Directors market California avocados through Calavo pursuant to marketing agreements substantially similar to the marketing agreements that we enter into with other growers. During the years ended October 31, 2022, 2021, and 2020, the aggregate amount of avocados procured from entities owned or controlled by members of our Board of Directors was million. We did Limoneira During fiscal years 2022, 2021, and 2020, we received $0.6 million, $0.5 million and $0.5 million as dividend income from Limoneira. In addition, we lease office space from Limoneira for our corporate office. Rent to Limoneira amounted to approximately million for fiscal years 2022, 2021, and 2020. Harold Edwards, who resigned as a member of our Board of Directors in February 2022, is the Chief Executive Officer of Limoneira Company. In February 2022, Limoneira ended its marketing agreement with Calavo. On October 27, 2022, we sold our entire investment of 1,677,299 shares of Limoneira common stock for gross proceeds of approximately $18.5 million. The net proceeds thereof after payment of commissions and expenses was used by the Company to pay down borrowings on its credit facility with Bank of America, as administrative agent, and the other lenders thereto. Contemporaneously with such sale, Bank of America, as administrative agent, released its lien on such shares in accordance with terms of the Credit Facility and the related loan documents. Agricola Don Memo, S.A. de C.V. (“Don Memo”) In December 2014, Calavo formed a wholly owned subsidiary Calavo Growers De Mexico, S. de R.L. de C.V. (Calavo Sub). In July 2015, Calavo Sub entered into a Shareholder Agreement with Belo a Mexican company owned by Agricola Belher, and formed Agricola Don Memo, S.A. de C.V. Belo and Calavo Sub have an equal one-half million each. Pursuant to a management service agreement, Belo, through its officers and employees, has day-to-day power and authority to manage the operations. Therefore, Don Memo is accounted for on the equity method as an unconsolidated entity. Belo is entitled to a management fee, as defined, which is payable annually in July of each year. Additionally, Calavo Sub is entitled to commission, for the sale of produce in Mexico, U.S., Canada, and any other overseas market. As of October 31, 2022, 2021 and 2020, we have an investment of $3.8 million, $4.3 million and $6.1 million, representing Calavo Sub’s 50% ownership in Don Memo, which is included as an investment in unconsolidated entities on our balance sheet. We make advances to Don Memo for operating purposes, provide additional advances as shipments are made during the season, and return the proceeds from tomato sales under our marketing program to Don Memo, net of our commission and aforementioned advances. For the year ended October 31, 2022, we advanced an additional $2.8 million of preseason advances to Don Memo. As of October 31, 2022, 2021 and 2020, we had outstanding advances of In October 2020, we entered into an infrastructure loan agreement with Don Memo for up to $2.4 million secured by certain property and equipment of Don Memo. This infrastructure loan accrues interest at . The total outstanding balance related to this infrastructure loan agreement at October 31, 2022 was million in other assets). The total outstanding balance related to this infrastructure loan agreement at October 31, 2021 was Belher We had grower advances due from Belher of $4.5 million, $4.5 million and $4.5 million as of October 31, 2022, 2021 and 2020. In August 2018, we entered into an amended infrastructure agreement with Belher and advanced . In August 2020, we have amended this agreement to lower the interest rate to million as of October 31, 2021 and 2020. This infrastructure advance was paid in full during fiscal 2022, through the netting against the grower payable to Belher (see below). In July 2021, we made a bridge loan of $3.5 million to Belher. This loan is secured by certain farmland in Mexico and accrues interest at million on July 31, 2024. As part of this amended loan agreement, we can withhold payments on both the infrastructure advances and the bridge loan through the netting against the grower payable due to Belher. For the year ended October 31, 2022, we withheld Avocados de Jalisco, S.A.P.I. de C.V. (“Avocados de Jalisco”) In August 2015, we entered into Shareholder’s Agreement with various partners to create Avocados de Jalisco, which is a Mexican corporation engaged in procuring, packing and selling avocados. This entity is approximately owned by Calavo and is consolidated in our financial statements. Avocados de Jalisco built a packinghouse located in Jalisco, Mexico and such packinghouse began operations in June of 2017. As of October 31, 2022 and 2021, we have made an insignificant amount of preseason advances to various partners of Avocados de Jalisco. During the year ended October 31, 2022, 2021 and 2020, we purchased approximately million of avocados from the partners of Avocados de Jalisco. |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 31, 2022 | |
Income Taxes | |
Income Taxes | 9. Income Taxes The income tax provision (benefit) consists of the following for the years ended October 31, (in thousands): 2022 2021 2020 Current: Federal $ 2,012 $ (3,449) $ (5,684) State 147 323 (214) Foreign 1,209 16,703 645 Total current 3,368 13,577 (5,253) Deferred: Federal (162) 790 576 State 746 (343) (505) Foreign (701) (3,934) 260 Total deferred (117) (3,487) 331 Change in valuation allowance — 657 630 Total income tax provision (benefit) $ 3,251 $ 10,747 $ (4,292) At October 31, 2022 and 2021, gross deferred tax assets totaled approximately $23.5 million and $29.3 million, while gross deferred tax liabilities totaled approximately $16.2 million and $22.7 million. Deferred income taxes reflect the net of temporary differences between the carrying amount of assets and liabilities for financial reporting and income tax purposes. Significant components of our deferred taxes assets (liabilities) as of October 31, are as follows (in thousands): 2022 2021 Property, plant, and equipment (2,002) (4,764) Intangible assets 2,828 5,051 Unrealized gain, Limoneira investment — (1,138) Stock-based compensation 715 511 State taxes 6 (498) Credits and incentives 1,194 1,808 Allowance for accounts receivable 936 1,259 Inventories 442 507 Accrued liabilities 1,143 2,067 Operating lease - Right of use assets (13,723) (15,839) Operating lease liabilities 14,861 17,040 Net operating loss 549 1,093 Valuation allowance (1,830) (1,291) Capital loss carryover 804 — Other (490) (490) Long-term deferred income taxes $ 5,433 $ 5,316 As of October 31, 2022 and 2021, the Company has no federal net operating loss carryforwards. The Company has gross state net operating loss carryforwards of approximately $9.1 million and $19.0 million with carryforward periods primarily ranging from 20 years to indefinite. The Company records a valuation allowance against deferred tax assets when determined that all or a portion of the deferred tax assets are not more likely than not to be realized based on all available evidence. As of October 31, 2022 and 2021, the Company recorded an approximate $1.8 million and $1.2 million valuation allowance against the deferred tax assets for state tax credit carryforwards and federal capital loss carryforwards that are more likely than not to expire unutilized. During the year ended October 31, 2022, the Company increased the valuation allowance against federal capital loss carryforwards by $0.6 million. A reconciliation of the significant differences between the federal statutory income tax rate and the effective income tax rate on pretax income (loss) for the years ended October 31, is as follows: 2022 2021 2020 Federal statutory tax rate 21.0 % 21.0 % 21.0 % State taxes, net of federal effects (1.3) 11.6 4.4 Rate differential on NOL carryback — 125.8 6.2 Foreign income taxes greater than U.S. 5.2 16.1 (2.3) Uncertain tax positions 5.1 (1,059.9) — Stock based compensation (6.1) (16.7) — Provision to return (59.9) 39.2 (2.5) State rate change (2.5) 9.2 (0.1) Valuation allowance (24.2) (44.1) (2.7) Other permanent differences (33.8) — — Other (0.5) (15.5) (0.3) (97.0) % (913.3) % 23.7 % For fiscal years 2022, 2021 and 2020, income (loss) before income taxes (benefit) related to domestic operations was approximately $(1.4) million, $(5.0) million, and $(18.9) million. Additionally, for fiscal 2022, we received income tax refunds of million. As of October 31, 2022, and 2021, we had $11.1 million and $11.3 million for unrecognized tax benefits related primarily to the probable outcomes of the 2013 Mexico Assessment. See Note 7 for further information. A reconciliation of the beginning and ending amount of gross unrecognized taxes (exclusive of interest and penalties) was as follows (in thousands): Year Ended October 31, 2022 2021 Beginning balance $ 11,303 $ 72 Reductions based on tax positions related to prior periods (172) — Gross increase - Tax positions in prior periods — 131 Gross increase - Tax positions in current period — 11,100 Ending balance $ 11,131 $ 11,303 Although it is reasonably possible that certain unrecognized tax benefits may increase or decrease within the next twelve months due to tax examination changes, settlement activities, expirations of statute of limitations, or the impact on recognition and measurement considerations related to the results of published tax cases or other similar activities, the Company does not anticipate any significant changes to unrecognized tax benefits over the next 12 months. The Company accounts for income taxes regarding uncertain tax positions and recognized interest and penalties related to uncertain tax positions in income tax benefit/(expense) in the consolidated statements of operations. Total accrued interest and penalties recorded on the consolidated balance sheet were zero because the company prepaid the disputed amount. See Note 7 for additional details. Due to our history of earnings, current, and expected future profitability, we believe there is sufficient objective positive evidence that it is more likely than not that we will realize our net deferred tax assets, therefore a valuation allowance over our federal and state net deferred tax assets is not needed, other than the state tax credit and federal capital loss carryforwards. We are subject to U.S. federal income tax as well as income of multiple state tax and foreign tax jurisdictions. We are no longer subject to U.S. income tax examinations for the fiscal years prior to October 31, 2019, and are no longer subject to state income tax examinations for fiscal years prior to October 31, 2018. The Company determined that certain foreign earnings to be indefinitely reinvested outside the United States. Our intent is to permanently reinvest these funds outside of the United States and our current plans do not demonstrate a need to repatriate the cash to fund our U.S. operations. However, if these funds were repatriated, we would be required to accrue and pay applicable United States taxes (if any) and withholding taxes payable to foreign tax authorities. |
Segment Information
Segment Information | 12 Months Ended |
Oct. 31, 2022 | |
Segment Information | |
Segment Information | 10. Segment Information On April 13, 2022, the Company announced its plans to reorganize its business into two reporting segments, Grown and Prepared. The management transition to operate as Grown and Prepared began at the start of the third quarter of 2022. The Grown segment consists of fresh avocados, tomatoes and papayas. The Prepared segment comprises all other products including fresh-cut fruits and vegetables, ready-to-eat sandwiches, wraps, salads and snacks, guacamole, and salsa sold at retail and food service as well as avocado pulp sold to foodservice. As a result of the Company's operating segment realignment, the composition of its reporting units for the evaluation of goodwill impairment was changed. RFG reporting unit goodwill is now included within the Prepared reporting unit. Therefore, the goodwill of $24.7 million, which was previously recorded within the RFG reporting unit, is now within Prepared and the goodwill previously reported as part of the Fresh segment remained unchanged in the amount of $4.0 million and is part of the Grown segment. Prior to the change in its reporting unit, the Company tested goodwill for impairment at the previous reporting unit, which did not result in any impairment charge. Goodwill impairment testing requires significant judgment and management estimates, including, but not limited to, the determination of (i) the number of reporting units, (ii) the goodwill and other assets and liabilities to be allocated to the reporting units and (iii) the fair values of the reporting units which includes forecasted cash flow. The fair value of the Company’s reporting units is determined using a combination of valuation techniques, including a discounted cash flow methodology. To corroborate the discounted cash flow analysis, a market approach is utilized using observable market data such as comparable companies in similar lines of business that are publicly traded. These business segments are presented based on how information is used by our Chief Executive Officer (our Chief Operating Decision Maker) to measure performance and allocate resources. Selling, general and administrative expenses, as well as other non-operating income/expense items, are evaluated by our Chief Executive Officer in the aggregate. We do not allocate assets, or specifically identify them, to our operating segments. Prior year information has been recast to conform with the new segment disclosures. The following table sets forth sales, cost of sales, and gross profit by segment (in thousands) Interco. Grown Prepared Elimins. Total (All amounts are presented in thousands) Year ended October 31, 2022 Net sales $ 700,270 $ 492,868 $ (2,065) $ 1,191,073 Cost of sales 650,105 469,188 (2,065) 1,117,228 Gross profit $ 50,165 $ 23,680 $ — $ 73,845 Year ended October 31, 2021 Net sales $ 588,527 $ 469,800 $ (2,497) $ 1,055,830 Cost of sales 540,740 460,162 (2,497) 998,405 Gross profit $ 47,787 $ 9,638 $ — $ 57,425 Year ended October 31, 2020 Net sales $ 585,052 $ 475,970 $ (1,651) $ 1,059,371 Cost of sales 537,489 433,635 (1,651) 969,473 Gross profit $ 47,563 $ 42,335 $ — $ 89,898 For fiscal year 2022, 2021 and 2020, inter-segment sales and cost of sales of $2.1 million, $2.5 million and $1.7 million between Grown and Prepared were eliminated. The following table sets forth sales by product category, by segment (in thousands): Year ended October 31, 2022 Year ended October 31, 2021 Grown Prepared Total Grown Prepared Total Avocados $ 645,944 $ — $ 645,944 $ 536,969 $ — $ 536,969 Tomatoes 47,288 — 47,288 43,658 — 43,658 Papayas 11,422 — 11,422 10,884 — 10,884 Other fresh income 123 — 123 693 — 693 Fresh-cut fruit — 204,433 204,433 — 205,087 205,087 Fresh-cut vegetables — 107,332 107,332 — 102,291 102,291 Prepared products — 114,396 114,396 — 95,639 95,639 Guacamole — 74,970 74,970 — 75,681 75,681 Salsa — 1,860 1,860 — 2,784 2,784 Total gross sales 704,777 502,991 1,207,768 592,204 481,482 1,073,686 Less sales allowances (4,507) (10,123) (14,630) (3,677) (11,682) (15,359) Less inter-company eliminations (2,065) — (2,065) (2,497) — (2,497) Net sales $ 698,205 $ 492,868 $ 1,191,073 $ 586,030 $ 469,800 $ 1,055,830 Year ended October 31, 2021 Year ended October 31, 2020 Grown Prepared Total Grown Prepared Total Avocados $ 536,969 $ — $ 536,969 $ 521,542 $ — $ 521,542 Tomatoes 43,658 — 43,658 53,922 — 53,922 Papayas 10,884 — 10,884 10,529 — 10,529 Other fresh income 693 — 693 327 — 327 Fresh-cut fruit — 205,087 205,087 — 204,766 204,766 Fresh-cut vegetables — 102,291 102,291 — 113,460 113,460 Prepared products — 95,639 95,639 — 88,346 88,346 Guacamole — 75,681 75,681 — 75,409 75,409 Salsa — 2,784 2,784 — 2,783 2,783 Total gross sales 592,204 481,482 1,073,686 586,320 484,764 1,071,084 Less sales allowances (3,677) (11,682) (15,359) (1,268) (8,794) (10,062) Less inter-company eliminations (2,497) — (2,497) (1,651) — (1,651) Net sales $ 586,030 $ 469,800 $ 1,055,830 $ 583,401 $ 475,970 $ 1,059,371 Sales to customers outside the U.S. were approximately $27.8 million, $34.8 million and $29.7 million for fiscal years 2022, 2021, and 2020. Prepared segment sales included sales to one customer who represented more than 10% of total consolidated revenues for fiscal 2022, 2021 and 2020. Additionally, the Grown products segment had sales to one customer that represented more than 10% of total consolidated revenues for fiscal 2021 and 2020. Our goodwill balance of $28.7 million is attributed by segment to Grown for $4.0 million and Prepared for $24.7 million as of October 31, 2022 and 2021. Long-lived assets attributed to geographic areas as of October 31, are as follows (in thousands): United States Mexico Consolidated October 31, 2022 $ 77,208 $ 36,102 $ 113,310 October 31, 2021 $ 81,059 $ 37,221 $ 118,280 |
Long-Term Obligations
Long-Term Obligations | 12 Months Ended |
Oct. 31, 2022 | |
Long-Term Obligations | |
Long-Term Obligations | 11. Long-Term Obligations Long-term obligations at fiscal year ends consist of the following (in thousands): 2022 2021 Finance leases 6,021 7,140 Less current portion (1,574) (1,587) $ 4,447 $ 5,553 See Note 17 for additional information. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Oct. 31, 2022 | |
Stock-Based Compensation | |
Stock-Based Compensation | 12. Stock-Based Compensation The 2011 Management Incentive Plan In April 2011, our shareholders approved the Calavo Growers, Inc. 2011 Management Incentive Plan (the 2011 Plan). All directors, officers, employees and consultants (including prospective directors, officers, employees and consultants) of Calavo and its subsidiaries are eligible to receive awards under the 2011 Plan. Up to On November 2, 2020, 11 of our non-employee directors were each granted 1,500 restricted shares, as part of their annual compensation (total of 16,500 shares). In January of fiscal 2020 all 12 of our non-employee directors were granted 1,500 restricted shares each (total of 18,000 shares). These shares have full voting rights and participate in dividends as if unrestricted. The closing price of our stock was for each respective year. After million for the year ended October 31, 2022 and 2021. On November 2, 2020, our executive officers were granted a total of 9,334 restricted shares. On December 18, 2019, our executive officers were granted a total of restricted shares. These shares have full voting rights and participate in dividends as if unrestricted. The closing price of our stock on such dates was , on an annual basis, beginning November 2, 2021. The shares granted in fiscal year 2020, vest in one million for the year ended October 31, 2022 and 2021. In April 2021, the Board of Directors approved the vesting of all of the remaining restricted shares outstanding to our former Chief Executive Officer and Board member. With this vesting, we recognized stock-based compensation of million for the year ended October 31, 2021. We recorded amortization of In June 2021, our former Chief Financial Officer, resigned from Calavo and 5,598 restricted shares were forfeited. We recorded amortization of $0.1 million for the year ended October 31, 2021, of previous stock grants before his resignation. In September 2021, the Board of Directors approved the vesting of all of the remaining restricted shares outstanding to our former Chief Executive Officer. With this vesting, we recognized stock-based compensation of The 2020 Equity Incentive Plan In April 2021, our shareholders approved the Calavo Growers, Inc. 2020 Equity Incentive Plan (the 2020 Plan). All directors, officers, employees and consultants (including prospective directors, officers, employees and consultants) of Calavo and its subsidiaries are eligible to receive awards under the 2020 Plan. This is a Restricted Stock Awards On December 13, 2021, certain of our officers were granted a total of 5,355 restricted shares. These shares have full voting rights and participate in dividends as if unrestricted. The closing price of our stock on such date was $40.53 . These shares vest over two years , on an annual basis, beginning December 13, 2022. These shares were granted pursuant to our 2020 Plan. The total recognized stock-based compensation expense for these grants was less than $0.1 million for the year ended October 31, 2022. On January 3, 2022, all 10 of our current directors were granted 2,814 restricted shares each (for a total of 28,140 shares). These shares have full voting rights and participate in dividends as if unrestricted. The closing share price of our stock on such grant date was $42.64. As of January 3, 2023, these shares will vest and become unrestricted subject to the continued service of the director. The total recognized stock-based compensation expense for these grants was $1.0 million for the year ended October 31, 2022. On January 20, 2022, one of our current directors was granted 1,500 unrestricted shares as a component of her compensation for services rendered during the 2021 fiscal year. The closing share price of our stock on such grant date was $41.73. The stock-based compensation expense for this grant was recognized in total upon grant and aggregated $0.1 million for the year ended October 31, 2022. On February 1, 2022, Brian Kocher, our new Chief Executive Officer, was granted 28,993 restricted shares as part of his employment agreement. The closing share price of our stock on such grant date was $41.39 . These shares will vest over three years on an annual basis, beginning February 1, 2023. The total recognized stock-based compensation expense for this grant was $0.3 million for the year ended October 31, 2022. A summary of restricted stock activity, related to our 2011 Plan and 2020 Plan, is as follows (in thousands, except for per share amounts): Weighted-Average Aggregate Number of Shares Grant Price Intrinsic Value Outstanding at October 31, 2021 43 $ 64.89 Vested (31) $ 45.44 Forfeited (9) $ 37.67 Granted 64 $ 41.88 Outstanding at October 31, 2022 67 $ 45.01 $ 2,318 The total recognized stock-based compensation expense for restricted stock awards was $2.3 million and $4.0 million for the years ended October 31, 2022 and 2021. Restricted Stock Units (RSUs) and Performance Restricted Stock Units (PRSUs) On April 1, 2022, we issued RSUs for officers and other members of management as part of our long-term incentive plan. The RSUs are time-based and vest annually in equal amounts over a three-year period. The PRSUs are based on three-year cumulative performance targets of net sales, adjusted EBITDA and return on invested capital and vest entirely at the third anniversary. We granted 34,269 RSUs and 34,269 PRSUs at a grant stock price of $37.49 . With the departure of our former Chief Financial Officer, 4,014 shares each of RSUs and PRSUs were forfeited. Based on our current projections, we recognized approximately $0.6 million of stock-based compensation for the year ended October 31, 2022. As of October 31, 2022, there was $2.2 million of unrecognized stock-based compensation costs related to non-vested RSUs and PRSUs, which the Company expects to recognize over a weighted-average period of 2.0 years. The total fair value of the restricted stock units at October 31, 2022, is approximately $2.2 million. In the third quarter of fiscal 2022, Shawn Munsell, our new Chief Financial Officer, and Danny Demas, our new SVP of Grown products were granted 9,002 RSUs and 3,533 RSUs, respectively, as part of their employment agreements. The closing share price of our stock on such grant dates were $38.88 and $42.46 , respectively. These shares will vest over three years on an annual basis, with the first third vesting on June 20, 2023, and July 11, 2023, respectively. The total recognized stock-based compensation expense for this grant was $0.1 million for the year ended October 31, 2022. In the fourth quarter of fiscal 2022, Helen Kurtz, our new SVP of Prepared products, and our new VP of global supply chain was granted 6,778 RSUs and 2,341 RSU’s as part of their employment agreements. The closing share price of our stock on such grant date was $44.26 and $42.71 , respectively. These shares will vest over three years on an annual basis, with the first third vesting on August 16, 2023 and August 29, 2023. The total recognized stock-based compensation expense for this grant was insignificant for the year ended October 31, 2022. In December 2022, we issued RSUs for officers and other members of management as part of our long-term incentive plan. The RSUs are time-based and vest annually in equal amounts over a three-year period. The PRSUs are based on three-year cumulative performance targets of net sales, adjusted EBITDA and return on invested capital and vest entirely at the third anniversary. We granted 101,800 RSUs and 66,228 PRSUs at a grant stock price of $34.51 . A combined summary of RSU and PRSU activity, related to our 2020 Plan, is as follows (in thousands, except for per share amounts): Number of Shares Weighted-Average Aggregate Represented Grant Price Intrinsic Value Outstanding at April 30, 2022 69 $ 37.49 Forfeited (8) $ 37.49 Granted 22 $ 41.56 Outstanding at October 31, 2022 83 $ 38.57 $ 3,253 The total recognized stock-based compensation expense for restricted stock units was $0.8 million for the year ended October 31, 2022. Stock Options In September 2021, our Board of Directors approved the issuance of options to acquire a total of 5,000 shares of our common stock to Steven Hollister, who for a period of time assumed the role of Interim Chief Executive Officer. Such grant vests in equal increments over a two-year period and has an exercise price of $39.20 per share. Vested options have an exercise period of five years from the vesting date. The market price of our common stock at the grant date was $39.20 . The estimated fair market value of such option grant was approximately $0.2 million. The total recognized stock-based compensation expense for this grant was insignificant for the year ended October 31, 2022. The value of each option award is estimated using a lattice-based option valuation model. We primarily consider the following assumptions when using these models: (1) expected volatility, (2) expected dividends, (3) expected life and (4) risk-free interest rate. Such models also consider the intrinsic value in the estimation of fair value of the option award. A summary of stock option activity, related to our 2011 and 2020 Management Incentive Plan, is as follows (in thousands, except for per share amounts): Weighted-Average Aggregate Exercise Intrinsic Number of Shares Price Value Outstanding at October 31, 2021 19 $ 42.89 Exercised (2) $ 23.48 Outstanding at October 31, 2022 17 $ 47.62 $ — Exercisable at October 31, 2022 12 $ 51.12 $ — The weighted average remaining life of such outstanding options is 1.5 years. The weighted average remaining life of such exercisable options is 2.4 years. The fair value of vested shares was insignificant for fiscal 2022 and $0.1 million for fiscal 2021. |
Dividends
Dividends | 12 Months Ended |
Oct. 31, 2022 | |
Dividends | |
Dividends | 13. Dividends In November 2022, we announced that we will begin declaring and paying dividends quarterly rather than annually as had been our practice. On December 14, 2022, we paid a dividend of On October 29, 2021, we declared a cash dividend of $1.15 per share. On December 3, 2021, we paid the aggregate amount of $20.3 million to shareholders of record on November 12, 2021. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Oct. 31, 2022 | |
Fair Value Measurements | |
Fair Value Measurements | 14. Fair Value Measurements A fair value measurement is determined based on the assumptions that a market participant would use in pricing an asset or liability. A three-tiered hierarchy draws distinctions between market participant assumptions based on (i) observable inputs such as quoted prices in active markets (Level 1), (ii) inputs other than quoted prices in active markets that are observable either directly or indirectly (Level 2) and (iii) unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (Level 3). The Company had no financial assets or liabilities measured at fair value on a recurring basis as of October 31, 2022. The following table sets forth our financial assets and liabilities as of October 31, 2021 that are measured on a recurring basis during the period, segregated by level within the fair value hierarchy: Level 1 Level 2 Level 3 Total (All amounts are pres nted in thousands) Assets at Fair Value at October 31, 2021: Investment in Limoneira Company (1) $ 27,055 — — $ 27,055 Total assets at fair value $ 27,055 — — $ 27,055 (1) The investment in Limoneira Company consists of marketable securities in the Limoneira Company stock. These securities were measured at fair value by quoted market prices. Limoneira’s stock price at October 31, 2021 equaled $16.13 per share (level 1). Our remaining shares of Limoneira stock, totaling 1,677,299 , were revalued to $16.13 per share and $13.83 per share at October 31, 2021 and 2020 and, as a result, we recorded a gain of $3.9 million for the year ended October 31, 2021 in our consolidated statements of operations . On October 27, 2022, the Company sold 1,677,299 shares of Limoneira common stock for gross proceeds of approximately $18.5 million. The net proceeds thereof after payment of commissions and expenses was used by the Company to pay down borrowings on its credit facility with Bank of America, as administrative agent, and the other lenders thereto. Contemporaneously with such sale, Bank of America, as administrative agent, released its lien on such shares in accordance with terms of the Credit Facility and the related loan documents. |
Mexican IVA taxes receivable
Mexican IVA taxes receivable | 12 Months Ended |
Oct. 31, 2022 | |
Mexican IVA taxes receivable | |
Mexican IVA taxes receivable | 15. Mexican IVA taxes receivable Included in other assets are tax receivables due from the Mexican government for value-added taxes (IVA) paid in advance. CDM is charged IVA by vendors on certain expenditures in Mexico, which, insofar as they relate to the exportation of goods, translate into IVA amounts receivable from the Mexican government. As of October 31, 2022, and October 31, 2021, CDM IVA receivables totaled $43.6 million (865.4 million Mexican pesos) and $37.5 million (762.1 million Mexican pesos). Historically, CDM received IVA refund payments from the Mexican tax authorities on a timely basis. Beginning in fiscal 2014 and continuing into fiscal 2021, however, the tax authorities began carrying out more detailed reviews of our refund requests and our supporting documentation. Additionally, they are also questioning the refunds requested attributable to IVA paid to certain suppliers that allegedly did not fulfill their own tax obligations. We believe these factors and others have contributed to delays in the processing of IVA claims by the Mexican tax authorities. Currently, we are in the process of collecting such balances primarily through regular administrative processes, but these amounts may ultimately need to be recovered through Administrative Appeals and/or legal means. During the first quarter of fiscal 2017, the tax authorities informed us that their internal opinion, based on the information provided by the local SAT office, considers that CDM is not properly documented relative to its declared tax structure and therefore CDM cannot claim the refundable IVA balance. CDM has strong arguments and supporting documentation to sustain its declared tax structure for IVA and income tax purposes. CDM started an Administrative Appeal for the IVA related to the request of the months of July, August and September of 2015 (the “2015 Appeal”) in order to assert its argument that CDM is properly documented and to therefore change the SAT’s internal assessment. In August 2018, we received a favorable ruling from the SAT’s Legal Administration in Michoacan on the 2015 Appeal indicating that they believe CDM’s legal interpretation of its declared tax structure is indeed accurate. While favorable on this central matter of CDM’s declared tax structure, the ruling, however, still does not recognize the taxpayers right to a full refund for the IVA related to the months of July, August and September 2015. Therefore, in October 2018, CDM filed a substance-over-form Annulment Suit in the Federal Tax Court to recover its full refund for IVA over the subject period, which is currently pending resolution. In April 2022, the Tax Court issued the ruling for the months of July, August and September 2015 through which it was declared that the following resolutions were resolved: ● It is recognized that CDM operates as a maquila under the authorization of the Ministry of Finance. ● It is recognized that all bank deposits corresponding to the purchase of avocados on behalf of Calavo Growers Inc. (CGI), are subject to the maquila program and it is not accruable income for purposes of Income Tax nor activities subject to VAT. ● It is recognized that VAT is recoverable, since CDM demonstrated the existence of operations carried under the maquila services. ● Resolved that certain VAT amounts attributed to the purchase of certain packing materials are not recoverable as CDM was not the buyer on record and therefore did not pay for the materials, which approximated $6.9 million pesos (approximately $0.3 million USD). The court is still reviewing the appeal filed by the Company on May 9, 2022, against the ruling resolving that certain VAT amounts are not recoverable . The latest court resolution sustains the Company’s position that it is entitled to substantially all of its VAT amounts, and the Company is considering its options for collecting the entire VAT receivable. In the unlikely event of an unfavorable resolution of the Administrative Appeals, we plan to file Annulment Suits with the Mexican Federal Tax Court. If these suits result in an unfavorable ruling, there is an option to appeal to the Collegiate Circuit Court. The estimated time for the resolution of these suits could be 2 – 3 years . We believe that our operations in Mexico are properly documented, and our internationally recognized tax advisors believe that there are legal grounds to prevail in collecting the corresponding IVA amounts. With assistance from our internationally recognized tax advisory firm, as of October 31, 2022, CDM has filed Administrative Appeals for months for which IVA refunds have been denied by the SAT, and will continue filing such appeals for any months for which refunds are denied in the future. Therefore, it is probable that the Mexican tax authorities will ultimately authorize the refund of the corresponding IVA amounts. |
FreshRealm Separation
FreshRealm Separation | 12 Months Ended |
Oct. 31, 2022 | |
FreshRealm Separation | |
FreshRealm Separation | 16. FreshRealm Separation On February 3, 2021, Calavo and FreshRealm entered into a Limited Liability Company Member Separation and Release Agreement (the “Separation Agreement”) described below. Calavo was previously a limited liability company member in FreshRealm and was a party to that certain FreshRealm, LLC Seventh Amended and Restated Limited Liability Company Agreement, dated as of February 27, 2019, by and among FreshRealm and its members. Calavo and FreshRealm were also parties to that certain Sixth Amended and Restated Senior Promissory Note, effective August 10, 2018, as amended (the “Prior Note”), pursuant to which Calavo loaned to FreshRealm principal plus accrued interest in the total sum of $34.5 million. We recorded a reserve of $34.5 million on this balance in the third quarter of fiscal 2020. Pursuant to the Separation Agreement, among other terms: (i) Calavo terminated its limited liability company interest and equity ownership in FreshRealm; (ii) Calavo and FreshRealm simultaneously entered into an Amended and Restated Senior Secured Loan Agreement and Promissory Note (the “Amended Note”), which amended and restated the Prior Note; (iii) FreshRealm issued an additional Secured Promissory Note to Calavo in the amount of approximately $5 million that is subordinated to the Amended Note (the “Second Note”, together with the Amended Note, the “Notes”); (iv) in the event FreshRealm paid Calavo the sum of $6 million (the “Loan Payoff Amount”) by March 31, 2022 (the “Loan Payoff Period”), the Notes shall be deemed paid in full; (v) the parties agreed to a mutual release of any claims; and (vi) the parties agreed to indemnify each other from any subsequent third party claims. In July 2021, FreshRealm paid Calavo the Loan Payoff Amount of $6.0 million, and we recorded the receipt as a recovery of the reserve for collectability of the FreshRealm note receivable on the statement of operations. Therefore, the Notes mentioned above, have been deemed paid in full. If FreshRealm undergoes a sale of its business either through a merger or a majority sale of its assets or equity interests before February 3, 2022, FreshRealm must pay Calavo twenty percent ( If FreshRealm (i) undergoes a “Success Event” in the future, including: a merger, a majority sale of FreshRealm’s assets or equity ownership interests, a private placement (greater than $35 million), or an initial public offering where FreshRealm as a company is valued at $100 million or more, FreshRealm must pay to the Company additional compensation in accordance with the following: ● FreshRealm must pay Calavo a $10 million payment upon the closing of a Success Event if the valuation of FreshRealm at the time of the Success Event is equal to or greater than $100 million, but less than $230 million; ● FreshRealm must pay Calavo a $20 million payment upon the closing of a Success Event if the valuation of FreshRealm at the time of the Success Event is equal to or greater than $230 million, but less than $380 million; or ● FreshRealm must pay Calavo a $34 million payment upon the closing of a Success Event if the valuation of FreshRealm at the time of the Success Event is equal to or greater than $380 Million. No amounts have been recorded on the balance sheet as of October 31, 2022 and 2021, with respect to a sale or success event. |
Leases
Leases | 12 Months Ended |
Oct. 31, 2022 | |
Leases | |
Leases | 17. Leases The impact of applying ASC 842 effective as of November 1, 2019, to the Company’s consolidated statements of operations and cash flows was not significant. The major impacts to the balance sheet at the effective date were 1) the addition of ASC 842 made changes to sale-leaseback accounting to result in the recognition of the gain on the transaction at the time of the sale instead of recognizing over the leaseback period, when the transaction is deemed to be a sale instead of a financing arrangement. ASC 842 further changes the assessment of sale accounting from a transfer of risk and rewards assessment to a transfer of control assessment. We lease property and equipment under finance and operating leases. For leases with terms greater than 12 months, we record the related asset and obligation at the present value of lease payments over the term. Many of our leases include rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when appropriate. Right-of-use assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Right-of-use assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. When available, we use the rate implicit in the lease to discount lease payments to present value; however, most of our leases do not provide a readily determinable implicit rate. We estimated our incremental borrowing rate based upon a synthetic credit rating and yield curve analysis. As a result, the incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments. We lease certain property, plant and equipment, including office facilities, under operating leases. The lease term consists of the noncancellable period of the lease and the periods covered by options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. The Company's lease agreements do not contain any residual value guarantees. Lease Position The following table presents the lease-related assets and liabilities recorded on the balance sheet as of October 31, 2022 and 2021 (in thousands): October 31, October 31, 2022 2021 Assets Non-current assets: Operating lease assets Operating lease right-of-use assets $ 54,518 $ 59,842 Finance lease assets Property, plant and equipment, net 5,721 6,907 $ 60,239 $ 66,749 Liabilities Current liabilities: Operating Current portion of operating leases $ 6,925 $ 6,817 Finance Current portion of long-term obligations and finance leases 1,574 1,587 Long-term obligations Operating Long-term operating leases, less current portion 52,140 57,561 Finance Long-term obligations and finance leases, less current portion 4,447 5,553 $ 65,086 $ 71,518 Weighted-average remaining lease term: Fiscal 2022 Fiscal 2021 Operating leases 9.3 years 10.1 years Finance leases 6.9 years 7.1 years Weighted-average discount rate: Operating leases 2.87 % 2.80 % Finance leases 3.62 % 3.20 % Lease Costs The following table presents certain information related to the lease costs for finance and operating leases for the year ended October 31, 2022 and 2021 (in thousands): Year ended Year ended October 31, 2022 October 31, 2021 Amortization of financing lease assets $ 1,756 $ 1,799 Operating lease cost 8,733 9,152 Short-term lease cost 2,483 2,981 Sublease income (30) (704) Variable lease cost 133 275 Interest on financing lease liabilities 213 235 Total lease cost $ 13,288 $ 13,738 Other Information The following table presents supplemental cash flow information related to the leases for the year ended October 31, 2022 and 2021 (in thousands): Year ended Year ended Cash paid for amounts included in the measurement of lease liabilities October 31, 2022 October 31, 2021 Operating cash flows for operating leases $ 7,012 $ 7,200 Financing cash flows for finance leases 1,683 1,672 Operating cash flows for finance leases 213 235 The total right-of-use assets obtained in exchange for new operating leases for the year ended October 31, 2022 and 2021 was $1.0 million and $1.0 million. Undiscounted Cash Flows The following table reconciles the undiscounted cash flows for each of the first five years and total remaining years to the finance lease liabilities and operating lease liabilities recorded on the balance sheet as of October 31, 2022 (in thousands): Operating Finance Leases Leases 2023 $ 8,494 $ 1,778 2024 8,311 1,280 2025 7,212 786 2026 6,737 495 2027 6,348 371 Thereafter 30,411 2,162 Total lease payments 67,513 6,872 Less: imputed interest 8,448 851 Total lease liability $ 59,065 $ 6,021 |
Closure of Prepared's Florida f
Closure of Prepared's Florida facility | 12 Months Ended |
Oct. 31, 2022 | |
Closure of Prepared's Florida facility | |
Closure of Prepared's Florida facility | 18. Closure of Prepared’s Florida facility On October 18, 2021, the Company announced the closure of Prepared’s food processing operations at its Green Cove Springs (near Jacksonville), Florida facility, as part of its Project Uno profit improvement program. As of November 15, 2021, the Green Cove facility for our Prepared segment has ceased operations. The Company’s Grown avocado operations at this facility will continue in operation and are not affected. We will continue to serve customers of this location from its other food processing locations, primarily in Georgia. The closure resulted in a reduction of employees, impairment of leasehold improvements, writedowns of inventory and other assets, and certain cash expenditures for the relocation of machinery and equipment and the closure of the leased facilities. The impairment related to the Prepared Florida closure has been recorded on the face of the income statement under “Impairment and charges related to Prepared’s Florida facility closure”. As of October 31, 2021, the Company had leasehold improvements with a net book value of As of October 31, 2022 and October 31, 2021, the Company had right of use assets with a net book value of $4.0 million and $4.8 million respectively, and lease liabilities of $5.3 million and $6.0 million, respectively, recorded on the balance sheet related to the closed facility. The facility lease has a maturity date of October 31, 2031. The Company intends to seek a sub-lease tenant to assume the vacated space, and believes such a sub-lease can be obtained at a lease rate, and for a lease period, sufficient to realize the right of use asset. However, a full impairment of the leasehold improvements was recorded during the year ended October 31, 2021, which represented the excess of the carrying value over the estimated fair value. Management will continue to evaluate the actual amounts and duration of expected future sub-lease revenues. Should the actual sub-lease revenues be less than those currently expected, the Company may need to record impairment of some or all of its investment in the right of use asset. An additional Following is a summary of the impairment and other charges recorded during the year ended October 31, 2021. Leasehold improvements $8,731 Inventory (recorded in cost of goods sold) 586 Employee severance 352 Other assets 79 Total $ 9,748 |
COVID-19 Pandemic Impact
COVID-19 Pandemic Impact | 12 Months Ended |
Oct. 31, 2022 | |
COVID-19 Pandemic Impact | |
COVID-19 Pandemic Impact | 19. COVID-19 Pandemic Impact On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China and the risks to the international community as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The COVID-19 pandemic has created challenging and unprecedented conditions for our business, and we are committed to taking action in support of a Company-wide response to the crisis. The COVID-19 pandemic has negatively impacted the global economy, disrupted global supply chains and created significant volatility and disruption of financial markets. We believe we are well-positioned for the future as we continue to navigate the crisis and prepare for an eventual return to a more normal operating environment. We have successfully implemented contingency plans in the U.S. and in Mexico to monitor the evolving needs of our businesses in those countries, as well as those related to our Peru partner in consignment avocado sales. The effects of the pandemic have been more pronounced in the portions of our business servicing foodservice customers and to a lesser extent certain segments of our retail business, including behind-the-glass deli and grab-and-go convenience items. |
Sale of Investment in Limoneira
Sale of Investment in Limoneira | 12 Months Ended |
Oct. 31, 2022 | |
Sale of Investment in Limoneira | |
Sale of Investment in Limoneira | 20. Sale of Investment in Limoneira On October 27, 2022, we sold our entire investment of 1,677,299 shares of Limoneira common stock for gross proceeds of approximately $18.5 million. The net proceeds thereof after payment of commissions and expenses were used to pay down borrowings on our credit facility with Bank of America, as administrative agent, and the other lenders thereto. Contemporaneously with such sale, Bank of America, as administrative agent, released its lien on such shares in accordance with terms of the Credit Facility and the related loan documents. |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 12 Months Ended |
Oct. 31, 2022 | |
Basis of Presentation and Significant Accounting Policies | |
Business | Business Calavo Growers, Inc. (referred to in this report as “Calavo”, the “Company”, “we’, “us” or “our”), is a global leader in the avocado industry and a provider of value-added fresh food. Our expertise in marketing and distributing avocados, prepared avocado products, and other perishable foods allows us to deliver a wide array of fresh and prepared food products to retail grocery, foodservice, club stores, mass merchandisers, food distributors and wholesalers on a worldwide basis. We procure avocados from California, Mexico and other growing regions around the world. Through our various operating facilities, we (i) sort, pack, and/or ripen avocados, tomatoes and/or Hawaiian grown papayas, (ii) create, process and package a portfolio of healthy fresh foods including fresh-cut fruit and vegetables, and prepared foods including sandwiches, salads, parfaits and ready-to-eat snack items among other products and (iii) process and package guacamole and salsa. We distribute our products both domestically and internationally and beginning in the third quarter of fiscal 2022 we report our operations in different business segments: Grown and Prepared. |
Consolidated financial statements | Our consolidated financial statements include the accounts of Calavo Growers, Inc. and our wholly owned subsidiaries, Calavo de Mexico S.A. de C.V. (Calavo de Mexico), Calavo Growers de Mexico, S. de R.L. de C.V. ( Calavo Growers de Mexico), Maui Fresh International, Inc. (Maui), Hawaiian Sweet, Inc. (HS), CW Hawaii Pride, LLC (HP), Calavo Salsa Lisa, LLC (CSL), Renaissance Food Group, LLC (RFG), and Avocados de Jalisco, S.A.P.I. de C.V. (Avocados de Jalisco), in which we have an 83% ownership interest. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Among the significant estimates affecting the financial statements are those related to valuation allowances for valuation allowances for accounts and notes receivable, goodwill, grower advances, inventories, long-lived assets, valuation of and estimated useful lives of identifiable intangible assets, stock-based compensation, promotional allowances and income taxes. On an ongoing basis, management reviews its estimates based upon currently available information. Actual results could differ materially from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents We consider all highly liquid financial instruments purchased with an original maturity date of three months or less to be cash equivalents. The carrying amounts of cash and cash equivalents approximate their fair values. |
Restricted Cash | Restricted Cash We have $1.0 million in restricted cash in our subsidiary Calavo de Mexico. This cash is restricted due to the 2013 tax assessment. In November 2022, this restriction was lifted. See Note 7. |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist primarily of non-trade receivables, infrastructure advances and prepaid expenses. Non-trade receivables were $4.8 million and $5.3 million at October 31, 2022 and 2021. Included in non-trade receivables are $1.8 million and $1.7 million related to the current portion of non-CDM Mexican IVA (i.e. value-added) taxes at October 31, 2022 and 2021 (See Note 15). Infrastructure advances are discussed below. Prepaid expenses totaling |
Accounts Receivable | Accounts Receivable Trade accounts receivable are reported at amounts due from customers, net of an allowance for doubtful accounts and customer deductions accounted for as variable consideration. The Company performs credit evaluations of customers and evaluates the need for allowances for potential credit losses based on historical experience, as well as current and expected general economic conditions. The total allowance for estimated uncollectable accounts receivable balances and customer deductions were $4.2 million and $4.8 million as of October 31, 2022 and 2021. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value. Cost is computed on a monthly weighted-average basis, which approximates the first-in, first-out method; market is based upon estimated replacement costs. Costs included in inventory primarily include the following: fruit, picking and hauling, overhead, labor, materials and freight. |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment are stated at cost and depreciated over their estimated useful lives using the straight-line method. Leasehold improvements are stated at cost and amortized over the lesser of their estimated useful lives or the term of the lease, using the straight-line method. Useful lives are as follows: buildings and improvements - . Significant repairs and maintenance that increase the value or extend the useful life of our fixed asset are capitalized. On-going maintenance and repairs are charged to expense. |
Goodwill and Acquired Intangible Assets | Goodwill and Acquired Intangible Assets Goodwill, defined as unidentified asset(s) acquired in conjunction with a business acquisition, is tested for impairment on an annual basis and between annual tests whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Goodwill is tested at the reporting unit level, which is defined as an operating segment or one level below the operating segment. We perform an assessment of goodwill for impairment on an annual basis, and between annual tests whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. To the extent the carrying amount of the reporting unit’s allocated goodwill exceeds the unit’s fair value, we recognize an impairment of goodwill for the excess up to the amount of goodwill of that reporting unit. As a result of the Company's operating segment realignment, the composition of its reporting units for the evaluation of goodwill impairment was changed. RFG reporting unit goodwill is now included within the Prepared reporting unit. Therefore, the goodwill of $24.7 million, which was previously recorded within the RFG reporting unit, is now within our Prepared segment and $4.0 million which was previously within the Fresh reporting unit, is now within our Grown segment. Prior to the change in its reporting unit, the Company tested goodwill for impairment at the previous reporting unit, which did not result in any impairment charge. In fiscal 2022 and 2021, the Company’s estimated fair value significantly exceeded its carrying value. The fair value of the Company’s reporting units is determined using a combination of valuation techniques, including a discounted cash flow methodology. To corroborate the discounted cash flow analysis, a market approach is utilized using observable market data such as comparable companies in similar lines of business that are publicly traded. The Company concluded based on its quantitative assessment that no goodwill impairment existed in the fiscal years ended October 31, 2022 and 2021. Goodwill impairment testing requires significant judgment and management estimates, including, but not limited to, the determination of (i) the number of reporting units, (ii) the goodwill and other assets and liabilities to be allocated to the reporting units and (iii) the fair values of the reporting units which includes forecasted cash flow. The estimates and assumptions described above, along with other factors such as discount rates, will significantly affect the outcome of the impairment tests and the amounts of any resulting impairment losses. |
Long-lived Assets | Long-lived Assets Long-lived assets, including fixed assets and intangible assets (other than goodwill), are continually monitored and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of any such asset may not be recoverable. The determination of recoverability is based on an estimate of undiscounted cash flows expected to result from the use of an asset and its eventual disposition. The estimate of undiscounted cash flows is based upon, among other things, certain assumptions about future operating performance, growth rates and other factors. Estimates of undiscounted cash flows may differ from actual cash flows due to, among other things, technological changes, economic conditions, changes to the business model or changes in operating performance. If the sum of the undiscounted cash flows (excluding interest) is less than the carrying value, an impairment loss will be recognized, measured as the amount by which the carrying value exceeds the fair value of the asset. For fiscal years 2022 and 2021, we performed our annual assessment of long-lived assets and determined that |
Investments | Investments We account for non-marketable investments using the equity method of accounting if the investment gives us the ability to exercise significant influence over, but not control, an investee. Significant influence generally exists when we have an ownership interest representing between 20% and 50% of the voting stock of the investee. Under the equity method of accounting, investments are stated at initial cost and are adjusted for subsequent additional investments and our proportionate share of earnings or losses and distributions. In December 2014, Calavo formed a wholly owned subsidiary Calavo Growers De Mexico, S. de R.L. de C.V. (Calavo Sub). In July 2015, Calavo Sub entered into a Shareholder Agreement with Grupo Belo del Pacifico, S.A. de C.V., (Belo) a Mexican company owned by Agricola Belher, and Agricola Don Memo, S.A. de C.V. (Don Memo). Don Memo, a Mexican corporation formed in July 2013, is engaged in the business of owning and improving land in Jalisco, Mexico for the growing of tomatoes and other produce and the sale and distribution of tomatoes and other produce. Belo and Calavo Sub have an equal one-half ownership interest in Don Memo. Pursuant to a management service agreement, Belo, through its officers and employees, shall have day-to-day power and authority to manage the operations. This investment contribution represent Calavo Sub’s ownership in Don Memo, which is included in investment in unconsolidated entities on our balance sheet. We use the equity method to account for this investment. As of October 31, 2022 and 2021, we have an investment of |
Marketable Securities | Marketable Securities Our marketable securities consist of our investment in Limoneira Company (Limoneira) stock. These securities are considered available for sale securities based on management’s intent with respect to such securities and are carried at fair value as determined from quoted market prices. On October 27, 2022, we sold 1,677,299 shares of Limoneira common stock for gross proceeds of approximately $18.5 million. The net proceeds thereof after payment of commissions and expenses was used by the Company to pay down borrowings on its credit facility with Bank of America, as administrative agent, and the other lenders thereto. Contemporaneously with such sale, Bank of America, as administrative agent, released its lien on such shares in accordance with terms of the Credit Facility and the related loan documents. For year ended October 31, 2022, million in our consolidated statements of operations. Limoneira’s stock price at October 31, 2021, and 2020 equaled $16.13 per share, and $13.83 per share. Our shares of Limoneira stock, totaling 1,677,299, were revalued to $16.13 per share at October 31, 2021 as a result, we recorded a gain of $3.9 million and a loss of $8.5 million for the year ended October 31, 2021 and 2020 in our consolidated statements of operations. |
Advances to Suppliers | Advances to Suppliers We advance funds to third-party growers primarily in Mexico for various farming needs. Typically, we obtain collateral (i.e. fruit, fixed assets, etc.) that approximates the value at risk, prior to making such advances. We continuously evaluate the ability of these growers to repay advances in order to evaluate the possible need to record an allowance. No such allowance was required at October 31, 2022 and 2021. Pursuant to our distribution agreement, which was amended in fiscal 2011, with Agricola Belher (Belher) of Mexico, a producer of fresh vegetables, primarily tomatoes, for export to the U.S. market, Belher agreed, at their sole cost and expense, to harvest, pack, export, ship, and deliver tomatoes exclusively to our Company, primarily our Arizona facility. In exchange, we agreed to sell and distribute such tomatoes, make advances to Belher for operating purposes, provide additional advances as shipments are made during the season (subject to limitations, as defined), and return the proceeds from such tomato sales to Belher, net of our commission and aforementioned advances. These advances will be collected through settlements by the end of each year. For fiscal 2022 and 2021, we agreed to advance Similar to Belher, we make advances to Don Memo for operating purposes, provide additional advances as shipments are made during the season, and return the proceeds from such tomato sales to Don Memo, net of our commission and aforementioned advances. As of October 31, 2022 and 2021, we have total advances of $7.0 million and $4.2 million to Don Memo, which is recorded in advances to suppliers, offset by tomato liabilities from the sales of tomatoes per the tomato marketing agreement. We have entered into a distribution agreement with a new tomato grower Exportadora Silvalber (Silvalber). We made |
Infrastructure Advances | Infrastructure Advances Pursuant to our infrastructure agreements, we make advances to be used solely for the acquisition, construction, and installation of improvements to and on certain land owned/controlled by Belher and Don Memo, as well as packing line equipment. In October 2020, we entered into an infrastructure loan agreement with Don Memo for $2.4 million secured by Don Memo’s property and equipment. This infrastructure loan accrues interest at . In October 2020, we advanced million related to this loan agreement. We advanced an additional million in other assets). As of October 31, 2022, we have a total outstanding balance at October 31, 2022 of In August 2018, we entered into an amended infrastructure loan agreement with Belher and advanced $3.0 million. This amount shall be paid back in annual installments of . Loans prior to this amended agreement accrued interest at Libor plus million per year). This portion of the infrastructure loan has been paid in full as of October 31, 2022, of which million was offset against the grower payable due to Belher. In July 2021, we made a bridge loan of $3.5 million to Belher. This loan is secured by certain farmland in Mexico and accrues interest at 10%. In the first quarter of fiscal 2022, this loan was amended to be due with installments of million on July 31, 2024. As part of this amended loan agreement, we can withhold payments on both the infrastructure advances and the bridge loan through the netting against the grower payable due to Belher. For the year ended October 31, 2022, we withheld |
Accrued Expenses | Accrued Expenses Included in accrued expenses are liabilities related to the receipt of goods and/or services for which an invoice has not yet been received. These totaled approximately $28.7 million and $32.6 million for the year ended October 31, 2022 and 2021. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when obligations under the terms of a contract with its customer are satisfied; generally, this occurs with the transfer of control of its products. Revenue is measured as the amount of net consideration expected to be received in exchange for transferring products. Revenue from product sales is governed primarily by customer pricing and related purchase orders (“contracts”) which specify shipping terms and certain aspects of the transaction price including variable considerations such as rebates, discounts and other sales incentives. Contracts are at standalone pricing. The performance obligation in these contracts is determined by each of the individual purchase orders and the respective stated quantities, with revenue being recognized at a point in time when obligations under the terms of the agreement are satisfied. This generally occurs with the transfer of control of our products to the customer and the product is delivered. The Company's customers have an implicit and explicit right to return non-conforming products. A provision for payment discounts and product return allowances, which is estimated, is recorded as a reduction of sales in the same period that the revenue is recognized. Sales Incentives and Other Promotional Programs The Company routinely offers sales incentives and discounts through various regional and national programs to our customers and consumers. These programs include product discounts or allowances, product rebates, product returns, one-time or ongoing trade-promotion programs with customers and consumer coupon programs that require the Company to estimate and accrue the expected costs of such programs. The costs associated with these activities are accounted for as reductions to the transaction price of the Company’s products and are, therefore, recorded as reductions to gross sales at the time of sale. The Company bases its estimates of incentive costs on historical trend experience with similar programs, actual incentive terms per customer contractual obligations and expected levels of performance of trade promotions, utilizing customer and sales organization inputs. The Company maintains liabilities at the end of each period for the estimated incentive costs incurred but unpaid for these programs. Differences between estimated and actual incentive costs are generally not material and are recognized in earnings in the period such differences are determined. Reserves for product returns, accrued rebates and promotional accruals are included in the consolidated balance sheets as part of accounts receivable or accrued expenses. Principal vs. Agent Considerations We frequently enter into consignment arrangements with avocado and tomato growers and packers located outside of the U.S. and growers of certain perishable products in the U.S. We evaluate whether its performance obligation is a promise to transfer services to the customer (as the principal) or to arrange for services to be provided by another party (as the agent) using a control model. This evaluation determined that the Company is in control of establishing the transaction price, managing all aspects of the shipments process and taking the risk of loss for delivery, collection, and returns. Based on the Company’s evaluation of the control model, it determined that all of the Company’s major businesses act as the principal rather than the agent within their revenue arrangements and such revenues are reported on a gross basis. |
Customers | Customers We sell to retail grocery, foodservice, club stores, mass merchandisers, food distributors and wholesale customers. Our top of our consolidated net sales in fiscal years 2022, 2021 and 2020. Sales to our largest customer, Kroger (including its affiliates), represented approximately of net sales in fiscal years 2022, 2021 and 2020. |
Shipping and Handling | Shipping and Handling We include shipping and handling fees billed to customers in net sales. Amounts incurred by us for freight are included in cost of goods sold. |
Promotional Allowances | Promotional Allowances We provide for promotional allowances at the time of sale, based on our historical experience. Our estimates are generally based on evaluating the historical relationship between promotional allowances and gross sales. The derived percentage is then applied to the current period’s sales revenues in order to arrive at the appropriate debit to sales allowances for the period. The offsetting credit is made to accrued expenses. When certain amounts of specific customer accounts are subsequently identified as promotional, they are written off against this allowance. Actual amounts may differ from these estimates and such differences are recognized as an adjustment to net sales in the period they are identified. |
Loss on Reserve for FreshRealm Note Receivable and Impairment of Investment | Loss on Reserve for FreshRealm Note Receivable and Impairment of Investment At the beginning of fiscal year 2020, we had a note receivable from FreshRealm totaling $34.5 million which has been fully reserved during fiscal 2020. In July 2021, FreshRealm paid Calavo the Loan Payoff Amount per the Separation Agreements with FreshRealm (See Note 16) of $6.0 million, and we recorded the receipt as a recovery of the reserve for collectability of the FreshRealm note receivable on the statement of operations. Therefore, the notes receivable mentioned above, have been deemed paid in full. |
Consignment Arrangements | Consignment Arrangements We frequently enter into consignment arrangements with avocado and tomato growers and packers located outside of the U.S. and growers of certain perishable products in the U.S. Although we generally do not take legal title to these avocados and perishable products, we do assume responsibilities (principally assuming credit risk, inventory loss and delivery risk, and pricing risk) that are consistent with acting as a principal in the transaction. Accordingly, the accompanying financial statements include sales and cost of sales from the sale of avocados and perishable products procured under consignment arrangements. Amounts recorded for each of the fiscal years ended October 31, 2022, 2021 and 2020 in the financial statements pursuant to consignment arrangements are as follows (in thousands): 2022 2021 2020 Sales $ 59,748 $ 52,287 $ 64,922 Cost of Sales 53,238 45,945 57,554 Gross Profit $ 6,510 $ 6,342 $ 7,368 |
Advertising Expense | Advertising Expense Advertising costs are expensed when incurred and are generally included as a component of selling, general and administrative expense. Such costs were approximately $0.6 million, $0.4 million and $0.4 million for fiscal years 2022, 2021, and 2020. |
Research and Development | Research and Development Research and development costs are expensed as incurred and are generally included as a component of selling, general and administrative expense. Total research and development costs for fiscal year 2022, 2021 and 2020 was approximately $0.1 million, $0.3 million and $0.7 million. |
Restructuring Costs | Restructuring Costs For the year ended October 31, 2022 and 2021, we recorded $2.8 million and $0.9 million of consulting expenses (included in selling, general and administrative expenses) related to an enterprise-wide strategic business review conducted for the purpose of restructuring to improve the profitability of the organization and efficiency of our operations. We also recorded $2.0 million and $0.6 million for the years ended October 31, 2022 and 2021, respectively, of management recruiting and severance costs related to this restructuring initiative. |
Other Income | Other Income Included in other income is dividend income totaling $0.8 million, $0.6 million, and $0.6 million for fiscal years 2022, 2021 and 2020. See Note 8 for related party disclosure related to other income. |
Income Taxes | Income Taxes We account for deferred tax liabilities and assets for the future consequences of events that have been recognized in our consolidated financial statements or tax returns. Measurement of the deferred items is based on enacted tax laws. In the event the future consequences of differences between financial reporting bases and tax bases of our assets and liabilities result in a deferred tax asset, we perform an evaluation of the probability of being able to realize the future benefits indicated by such asset. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion or all of the deferred tax asset will not be realized. We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. As a multinational corporation, we are subject to taxation in many jurisdictions, and the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in various taxing jurisdictions. If we ultimately determine that the payment of these liabilities will be unnecessary, the liability will be reversed and we will recognize a tax benefit during the period in which it is determined the liability no longer applies. Conversely, we record additional tax charges in a period in which it is determined that a recorded tax liability is less than the ultimate assessment is expected to be. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability for U.S. or foreign taxes may be materially different from management’s estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities. |
Basic and Diluted Net Income (loss) per Share | Basic and Diluted Net Loss per Share Basic earnings per share is calculated using the weighted-average number of common shares outstanding during the period without consideration of the dilutive effect of stock options and contingent consideration. Diluted earnings per common share is calculated using the weighted-average number of common shares outstanding during the period after consideration of the dilutive effect of stock options and the effect of contingent consideration shares. Basic and diluted net loss per share is calculated as follows (U.S. dollars in thousands, except per share data): Year ended October 31, 2022 2021 2020 Numerator: Net loss attributable to Calavo Growers, Inc. $ (6,249) $ (11,818) $ (13,625) Denominator: Weighted average shares – Basic 17,663 17,621 17,564 Effect of dilutive securities – Restricted stock/units/options (1) — — — Weighted average shares – Diluted 17,663 17,621 17,564 Net loss per share attributable to Calavo Growers, Inc: Basic $ (0.35) $ (0.67) $ (0.78) Diluted $ (0.35) $ (0.67) $ (0.78) |
Stock-Based Compensation | Stock-Based Compensation We account for awards of equity instruments issued to employees under the fair value method of accounting and recognize such amounts in our statements of operations. We measure compensation cost for all stock-based awards at fair value on the date of grant and recognize compensation expense in our consolidated statements of operations over the service period that the awards are expected to vest. For the years ended October 31, 2022, 2021 and 2020, we recognized compensation expense of $3.1 million, $4.0 million, and $4.5 million related to stock-based compensation (See Note 12). The value of the stock-based compensation was determined from quoted market prices at the date of the grant. |
Foreign Currency Translation and Remeasurement | Foreign Currency Translation and Remeasurement Our foreign operations are subject to exchange rate fluctuations and foreign currency transaction costs. The functional currency of our foreign subsidiaries is the United States dollar. As a result, monetary assets and liabilities are translated into U.S. dollars at exchange rates as of the balance sheet date and non-monetary assets, liabilities and equity are translated at historical rates. Sales and expenses are translated using a weighted-average exchange rate for the period. Gains and losses resulting from those remeasurements are included in income. Gains and losses resulting from foreign currency transactions are also recognized in income. Total foreign currency translation gains for fiscal 2021, net of losses, was |
Fair Value of Financial Instruments | Fair Value of Financial Instruments We believe that the carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and short-term borrowings approximates fair value based on either their short-term nature or on terms currently available to the Company in financial markets. Due to current market rates, we believe that our fixed-rate long-term obligations and finance leases have nearly the same fair value and carrying value of approximately |
Derivative Financial Instruments | Derivative Financial Instruments We were not a party to any material derivative instruments during the fiscal year. It is currently our intent not to use derivative instruments for speculative or trading purposes. Additionally, we do not use any hedging or forward contracts to offset market volatility. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes," which amends and simplifies the accounting for income taxes by removing certain exceptions and providing new guidance to reduce complexity in certain aspects of the current guidance. This guidance was adopted by the Company during the first quarter of 2022 and did not impact the Company’s financial statements or related disclosures. |
Noncontrolling Interest | Noncontrolling Interest The following tables reconcile shareholders’ equity attributable to noncontrolling interest related to Avocados de Jalisco (in thousands). Year ended Year ended Avocados de Jalisco noncontrolling interest October 31, 2022 October 31, 2021 Noncontrolling interest, beginning $ 1,368 $ 1,472 Net loss attributable to noncontrolling interest of Avocados de Jalisco (353) (104) Noncontrolling interest, ending $ 1,015 $ 1,368 |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Basis of Presentation and Significant Accounting Policies | |
Financial Statements of Consignment Arrangements | 2022 2021 2020 Sales $ 59,748 $ 52,287 $ 64,922 Cost of Sales 53,238 45,945 57,554 Gross Profit $ 6,510 $ 6,342 $ 7,368 |
Schedule of basic and diluted net income per share | Year ended October 31, 2022 2021 2020 Numerator: Net loss attributable to Calavo Growers, Inc. $ (6,249) $ (11,818) $ (13,625) Denominator: Weighted average shares – Basic 17,663 17,621 17,564 Effect of dilutive securities – Restricted stock/units/options (1) — — — Weighted average shares – Diluted 17,663 17,621 17,564 Net loss per share attributable to Calavo Growers, Inc: Basic $ (0.35) $ (0.67) $ (0.78) Diluted $ (0.35) $ (0.67) $ (0.78) |
Reconciliation of shareholders' equity attributable to noncontrolling interest | The following tables reconcile shareholders’ equity attributable to noncontrolling interest related to Avocados de Jalisco (in thousands). Year ended Year ended Avocados de Jalisco noncontrolling interest October 31, 2022 October 31, 2021 Noncontrolling interest, beginning $ 1,368 $ 1,472 Net loss attributable to noncontrolling interest of Avocados de Jalisco (353) (104) Noncontrolling interest, ending $ 1,015 $ 1,368 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Inventories | |
Schedule of Inventories | Inventories consist of the following (in thousands): October 31, 2022 2021 Fresh fruit $ 16,938 $ 17,648 Packing supplies and ingredients 14,176 13,088 Finished prepared foods 7,716 10,021 Total $ 38,830 $ 40,757 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Property, Plant, and Equipment | |
Summary of Property, Plant, and Equipment | Property, plant, and equipment consist of the following (in thousands): October 31, 2022 2021 Land $ 11,008 $ 11,008 Buildings and improvements 45,733 46,133 Leasehold improvements 19,030 25,114 Equipment 121,441 115,942 Information systems - hardware and software 11,920 11,598 Construction in progress 8,307 5,802 217,439 215,597 Less accumulated depreciation and amortization (104,129) (97,317) $ 113,310 $ 118,280 |
Other Assets and Intangibles (T
Other Assets and Intangibles (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Other Assets and Intangibles | |
Schedule of Other Assets | Other assets consist of the following (in thousands): October 31, October 31, 2022 2021 Mexican IVA (i.e. value-added) taxes receivable $ 43,625 $ 37,493 Infrastructure advances to Agricola Belher 1,241 1,641 Bridge loan to Agricola Belher 1,700 — Other 604 1,366 Total $ 47,170 $ 40,500 |
Schedule of Intangible Assets | The intangible assets consist of the following (in thousands): October 31, 2022 October 31, 2021 Weighted- Gross Net Gross Net Average Carrying Accum. Book Carrying Accum. Book Useful Life Value Amortization Value Value Amortization Value Customer list/relationships 8 years $ 17,340 $ (11,373) $ 5,967 $ 17,340 $ (9,989) $ 7,351 Trade names 8 years 4,060 (3,100) 960 4,060 (2,980) 1,080 Trade secrets/recipes 9 years 630 (626) 4 630 (567) 63 Brand name intangibles indefinite 275 — 275 275 — 275 Intangibles, net $ 22,305 $ (15,099) $ 7,206 $ 22,305 $ (13,536) $ 8,769 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Income Taxes | |
Summary of Income Tax Provision (Benefit) | The income tax provision (benefit) consists of the following for the years ended October 31, (in thousands): 2022 2021 2020 Current: Federal $ 2,012 $ (3,449) $ (5,684) State 147 323 (214) Foreign 1,209 16,703 645 Total current 3,368 13,577 (5,253) Deferred: Federal (162) 790 576 State 746 (343) (505) Foreign (701) (3,934) 260 Total deferred (117) (3,487) 331 Change in valuation allowance — 657 630 Total income tax provision (benefit) $ 3,251 $ 10,747 $ (4,292) |
Significant Components of Deferred Taxes Assets (Liabilities) | Significant components of our deferred taxes assets (liabilities) as of October 31, are as follows (in thousands): 2022 2021 Property, plant, and equipment (2,002) (4,764) Intangible assets 2,828 5,051 Unrealized gain, Limoneira investment — (1,138) Stock-based compensation 715 511 State taxes 6 (498) Credits and incentives 1,194 1,808 Allowance for accounts receivable 936 1,259 Inventories 442 507 Accrued liabilities 1,143 2,067 Operating lease - Right of use assets (13,723) (15,839) Operating lease liabilities 14,861 17,040 Net operating loss 549 1,093 Valuation allowance (1,830) (1,291) Capital loss carryover 804 — Other (490) (490) Long-term deferred income taxes $ 5,433 $ 5,316 |
Reconciliation of effective tax rate | 2022 2021 2020 Federal statutory tax rate 21.0 % 21.0 % 21.0 % State taxes, net of federal effects (1.3) 11.6 4.4 Rate differential on NOL carryback — 125.8 6.2 Foreign income taxes greater than U.S. 5.2 16.1 (2.3) Uncertain tax positions 5.1 (1,059.9) — Stock based compensation (6.1) (16.7) — Provision to return (59.9) 39.2 (2.5) State rate change (2.5) 9.2 (0.1) Valuation allowance (24.2) (44.1) (2.7) Other permanent differences (33.8) — — Other (0.5) (15.5) (0.3) (97.0) % (913.3) % 23.7 % |
Reconciliation of unrecognized taxes | A reconciliation of the beginning and ending amount of gross unrecognized taxes (exclusive of interest and penalties) was as follows (in thousands): Year Ended October 31, 2022 2021 Beginning balance $ 11,303 $ 72 Reductions based on tax positions related to prior periods (172) — Gross increase - Tax positions in prior periods — 131 Gross increase - Tax positions in current period — 11,100 Ending balance $ 11,131 $ 11,303 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Segment Information | |
Schedule of sales by product and segment | The following table sets forth sales by product category, by segment (in thousands): Year ended October 31, 2022 Year ended October 31, 2021 Grown Prepared Total Grown Prepared Total Avocados $ 645,944 $ — $ 645,944 $ 536,969 $ — $ 536,969 Tomatoes 47,288 — 47,288 43,658 — 43,658 Papayas 11,422 — 11,422 10,884 — 10,884 Other fresh income 123 — 123 693 — 693 Fresh-cut fruit — 204,433 204,433 — 205,087 205,087 Fresh-cut vegetables — 107,332 107,332 — 102,291 102,291 Prepared products — 114,396 114,396 — 95,639 95,639 Guacamole — 74,970 74,970 — 75,681 75,681 Salsa — 1,860 1,860 — 2,784 2,784 Total gross sales 704,777 502,991 1,207,768 592,204 481,482 1,073,686 Less sales allowances (4,507) (10,123) (14,630) (3,677) (11,682) (15,359) Less inter-company eliminations (2,065) — (2,065) (2,497) — (2,497) Net sales $ 698,205 $ 492,868 $ 1,191,073 $ 586,030 $ 469,800 $ 1,055,830 Year ended October 31, 2021 Year ended October 31, 2020 Grown Prepared Total Grown Prepared Total Avocados $ 536,969 $ — $ 536,969 $ 521,542 $ — $ 521,542 Tomatoes 43,658 — 43,658 53,922 — 53,922 Papayas 10,884 — 10,884 10,529 — 10,529 Other fresh income 693 — 693 327 — 327 Fresh-cut fruit — 205,087 205,087 — 204,766 204,766 Fresh-cut vegetables — 102,291 102,291 — 113,460 113,460 Prepared products — 95,639 95,639 — 88,346 88,346 Guacamole — 75,681 75,681 — 75,409 75,409 Salsa — 2,784 2,784 — 2,783 2,783 Total gross sales 592,204 481,482 1,073,686 586,320 484,764 1,071,084 Less sales allowances (3,677) (11,682) (15,359) (1,268) (8,794) (10,062) Less inter-company eliminations (2,497) — (2,497) (1,651) — (1,651) Net sales $ 586,030 $ 469,800 $ 1,055,830 $ 583,401 $ 475,970 $ 1,059,371 |
Schedule of segment gross margin | The following table sets forth sales, cost of sales, and gross profit by segment (in thousands) Interco. Grown Prepared Elimins. Total (All amounts are presented in thousands) Year ended October 31, 2022 Net sales $ 700,270 $ 492,868 $ (2,065) $ 1,191,073 Cost of sales 650,105 469,188 (2,065) 1,117,228 Gross profit $ 50,165 $ 23,680 $ — $ 73,845 Year ended October 31, 2021 Net sales $ 588,527 $ 469,800 $ (2,497) $ 1,055,830 Cost of sales 540,740 460,162 (2,497) 998,405 Gross profit $ 47,787 $ 9,638 $ — $ 57,425 Year ended October 31, 2020 Net sales $ 585,052 $ 475,970 $ (1,651) $ 1,059,371 Cost of sales 537,489 433,635 (1,651) 969,473 Gross profit $ 47,563 $ 42,335 $ — $ 89,898 |
Schedule of long-lived assets by geographic areas | United States Mexico Consolidated October 31, 2022 $ 77,208 $ 36,102 $ 113,310 October 31, 2021 $ 81,059 $ 37,221 $ 118,280 |
Long-Term Obligations (Tables)
Long-Term Obligations (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Long-Term Obligations | |
Schedule of long-term obligations | Long-term obligations at fiscal year ends consist of the following (in thousands): 2022 2021 Finance leases 6,021 7,140 Less current portion (1,574) (1,587) $ 4,447 $ 5,553 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Stock-Based Compensation | |
Restricted Stock and RSU Activity | Weighted-Average Aggregate Number of Shares Grant Price Intrinsic Value Outstanding at October 31, 2021 43 $ 64.89 Vested (31) $ 45.44 Forfeited (9) $ 37.67 Granted 64 $ 41.88 Outstanding at October 31, 2022 67 $ 45.01 $ 2,318 |
Summary of RSU activity | A combined summary of RSU and PRSU activity, related to our 2020 Plan, is as follows (in thousands, except for per share amounts): Number of Shares Weighted-Average Aggregate Represented Grant Price Intrinsic Value Outstanding at April 30, 2022 69 $ 37.49 Forfeited (8) $ 37.49 Granted 22 $ 41.56 Outstanding at October 31, 2022 83 $ 38.57 $ 3,253 |
Summary of stock option activity | A summary of stock option activity, related to our 2011 and 2020 Management Incentive Plan, is as follows (in thousands, except for per share amounts): Weighted-Average Aggregate Exercise Intrinsic Number of Shares Price Value Outstanding at October 31, 2021 19 $ 42.89 Exercised (2) $ 23.48 Outstanding at October 31, 2022 17 $ 47.62 $ — Exercisable at October 31, 2022 12 $ 51.12 $ — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Fair Value Measurements | |
Financial assets measured on recurring basis | Level 1 Level 2 Level 3 Total (All amounts are pres nted in thousands) Assets at Fair Value at October 31, 2021: Investment in Limoneira Company (1) $ 27,055 — — $ 27,055 Total assets at fair value $ 27,055 — — $ 27,055 (1) The investment in Limoneira Company consists of marketable securities in the Limoneira Company stock. These securities were measured at fair value by quoted market prices. Limoneira’s stock price at October 31, 2021 equaled $16.13 per share (level 1). Our remaining shares of Limoneira stock, totaling 1,677,299 , were revalued to $16.13 per share and $13.83 per share at October 31, 2021 and 2020 and, as a result, we recorded a gain of $3.9 million for the year ended October 31, 2021 in our consolidated statements of operations . |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Leases | |
Schedule of lease-related assets and liabilities and cost | The following table presents the lease-related assets and liabilities recorded on the balance sheet as of October 31, 2022 and 2021 (in thousands): October 31, October 31, 2022 2021 Assets Non-current assets: Operating lease assets Operating lease right-of-use assets $ 54,518 $ 59,842 Finance lease assets Property, plant and equipment, net 5,721 6,907 $ 60,239 $ 66,749 Liabilities Current liabilities: Operating Current portion of operating leases $ 6,925 $ 6,817 Finance Current portion of long-term obligations and finance leases 1,574 1,587 Long-term obligations Operating Long-term operating leases, less current portion 52,140 57,561 Finance Long-term obligations and finance leases, less current portion 4,447 5,553 $ 65,086 $ 71,518 Weighted-average remaining lease term: Fiscal 2022 Fiscal 2021 Operating leases 9.3 years 10.1 years Finance leases 6.9 years 7.1 years Weighted-average discount rate: Operating leases 2.87 % 2.80 % Finance leases 3.62 % 3.20 % Lease Costs The following table presents certain information related to the lease costs for finance and operating leases for the year ended October 31, 2022 and 2021 (in thousands): Year ended Year ended October 31, 2022 October 31, 2021 Amortization of financing lease assets $ 1,756 $ 1,799 Operating lease cost 8,733 9,152 Short-term lease cost 2,483 2,981 Sublease income (30) (704) Variable lease cost 133 275 Interest on financing lease liabilities 213 235 Total lease cost $ 13,288 $ 13,738 Other Information The following table presents supplemental cash flow information related to the leases for the year ended October 31, 2022 and 2021 (in thousands): Year ended Year ended Cash paid for amounts included in the measurement of lease liabilities October 31, 2022 October 31, 2021 Operating cash flows for operating leases $ 7,012 $ 7,200 Financing cash flows for finance leases 1,683 1,672 Operating cash flows for finance leases 213 235 |
Schedule of undiscounted cash flows of operating lease | The following table reconciles the undiscounted cash flows for each of the first five years and total remaining years to the finance lease liabilities and operating lease liabilities recorded on the balance sheet as of October 31, 2022 (in thousands): Operating Finance Leases Leases 2023 $ 8,494 $ 1,778 2024 8,311 1,280 2025 7,212 786 2026 6,737 495 2027 6,348 371 Thereafter 30,411 2,162 Total lease payments 67,513 6,872 Less: imputed interest 8,448 851 Total lease liability $ 59,065 $ 6,021 |
Schedule of undiscounted cash flows of finance lease | Operating Finance Leases Leases 2023 $ 8,494 $ 1,778 2024 8,311 1,280 2025 7,212 786 2026 6,737 495 2027 6,348 371 Thereafter 30,411 2,162 Total lease payments 67,513 6,872 Less: imputed interest 8,448 851 Total lease liability $ 59,065 $ 6,021 |
Closure of Prepared's Florida_2
Closure of Prepared's Florida facility (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Closure of Prepared's Florida facility | |
Summary of impairment and other charges | Leasehold improvements $8,731 Inventory (recorded in cost of goods sold) 586 Employee severance 352 Other assets 79 Total $ 9,748 |
Description of the business (De
Description of the business (Details) - segment | 12 Months Ended | |
Apr. 13, 2022 | Oct. 31, 2022 | |
Description of the business | ||
Number of reportable segments | 2 | 2 |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies - Presentation (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Significant Accounting Policies [Line Items] | ||
Restricted cash | $ 1,074 | $ 970 |
Tax Assessment 2013 | ||
Significant Accounting Policies [Line Items] | ||
Restricted cash | $ 1,000 | |
Avocados de Jalisco | Avocados de Jalisco | ||
Significant Accounting Policies [Line Items] | ||
Subsidiary ownership (as a percent) | 83% |
Basis of Presentation and Sig_5
Basis of Presentation and Significant Accounting Policies - Prepaid (Details) - USD ($) $ in Millions | Oct. 31, 2022 | Oct. 31, 2021 |
Basis of Presentation and Significant Accounting Policies | ||
Non-trade receivables | $ 4.8 | $ 5.3 |
Mexican IVA | 1.8 | 1.7 |
Prepaid expenses | $ 3.1 | $ 3.7 |
Basis of Presentation and Sig_6
Basis of Presentation and Significant Accounting Policies - PPE and Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 31, 2022 | Oct. 31, 2021 | |
Significant Accounting Policies [Line Items] | ||
Goodwill | $ 28,653 | $ 28,653 |
Prepared Reporting Unit [Member] | ||
Significant Accounting Policies [Line Items] | ||
Goodwill | 24,700 | |
Grown Reporting Unit [Member] | ||
Significant Accounting Policies [Line Items] | ||
Goodwill | $ 4,000 | |
Minimum | Buildings and improvements [Member] | ||
Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Minimum | Leasehold improvements [Member] | ||
Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Minimum | Equipment [Member] | ||
Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Minimum | Information systems - hardware and software [Member] | ||
Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Maximum | Buildings and improvements [Member] | ||
Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 50 years | |
Maximum | Equipment [Member] | ||
Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 25 years | |
Maximum | Information systems - hardware and software [Member] | ||
Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 10 years |
Basis of Presentation and Sig_7
Basis of Presentation and Significant Accounting Policies - Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2022 | Oct. 31, 2021 | |
Basis of Presentation and Significant Accounting Policies | ||
Goodwill impairment | $ 0 | $ 0 |
Impairment of long-lived assets | $ 0 | $ 0 |
Basis of Presentation and Sig_8
Basis of Presentation and Significant Accounting Policies - Investments (Details) - USD ($) $ in Thousands | 1 Months Ended | |||
Jul. 31, 2015 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Significant Accounting Policies [Line Items] | ||||
Investments in unconsolidated entities | $ 3,782 | $ 4,346 | ||
Don Memo | ||||
Significant Accounting Policies [Line Items] | ||||
Ownership interest (as a percent) | 50% | 50% | ||
Investment in FreshRealm | $ 2,000 | |||
Investments in unconsolidated entities | $ 3,800 | $ 4,300 | $ 6,100 | |
Don Memo | Belo | ||||
Significant Accounting Policies [Line Items] | ||||
Ownership interest (as a percent) | 50% |
Basis of Presentation and Sig_9
Basis of Presentation and Significant Accounting Policies - Marketable Securities (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Oct. 27, 2022 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Significant Accounting Policies [Line Items] | ||||
Gross proceeds for common stock | $ 18,450 | |||
Realized and unrealized net gain (loss) on Limoneira shares | (8,605) | $ 3,858 | $ (8,537) | |
Limoneira | ||||
Significant Accounting Policies [Line Items] | ||||
Limoneira's stock price | $ 16.13 | $ 13.83 | ||
Limoneira | ||||
Significant Accounting Policies [Line Items] | ||||
Number of securities sold | 1,677,299 | |||
Gross proceeds for common stock | $ 18,500 | |||
Investment shares held (in shares) | 1,677,299 | 1,677,299 | ||
Realized and unrealized net gain (loss) on Limoneira shares | $ (8,600) | $ 3,900 | $ (8,500) |
Basis of Presentation and Si_10
Basis of Presentation and Significant Accounting Policies - Advances to Suppliers (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 |
Significant Accounting Policies [Line Items] | |||
Advances to suppliers | $ 12,430 | $ 6,693 | |
Silvalber | |||
Significant Accounting Policies [Line Items] | |||
Advances to suppliers | 1,400 | ||
Don Memo | |||
Significant Accounting Policies [Line Items] | |||
Commitment amount | $ 2,400 | ||
Advances to suppliers | 7,000 | 4,200 | 2,400 |
Agricola Belher | |||
Significant Accounting Policies [Line Items] | |||
Commitment amount | 4,500 | 4,500 | |
Advances to suppliers | $ 4,500 | $ 4,500 | $ 4,500 |
Basis of Presentation and Si_11
Basis of Presentation and Significant Accounting Policies - Infrastructure Advances (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||
Oct. 31, 2020 | Aug. 31, 2020 | Aug. 31, 2018 | Apr. 30, 2021 | Jan. 31, 2021 | Oct. 31, 2022 | Oct. 31, 2020 | Jan. 31, 2022 | Oct. 31, 2021 | Jul. 31, 2021 | Jul. 31, 2018 | |
Significant Accounting Policies [Line Items] | |||||||||||
Non-cash settlement of advance | $ 1,060 | $ 2,761 | |||||||||
Agricola Belher | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Commitment amount | 4,500 | $ 4,500 | |||||||||
Amount loaned | $ 3,000 | ||||||||||
Loan receivable fixed interest rate (as a percent) | 7.25% | 10% | |||||||||
Infrastructure advance | $ 1,800 | 3,000 | 1,800 | 900 | |||||||
Term of loans receivables | 2 years | ||||||||||
Annual repayment of advances | $ 900 | $ 600 | |||||||||
Bridge loan to related parties | $ 3,500 | ||||||||||
Expected payment 2022 | $ 900 | 900 | |||||||||
Expected payment 2023 | 900 | 900 | |||||||||
Expected payment 2024 | $ 1,700 | $ 1,700 | |||||||||
Non-cash settlement of advance | 1,100 | ||||||||||
Agricola Belher | Prepaid expenses and other current assets | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Bridge loan to related parties | 900 | ||||||||||
Agricola Belher | Other long-term assets | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Bridge loan to related parties | 1,700 | ||||||||||
Agricola Belher | Infrastructure loan | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Non-cash settlement of advance | 200 | ||||||||||
Agricola Belher | Bridge loan | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Non-cash settlement of advance | 900 | ||||||||||
Agricola Belher | LIBOR | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Advances variable interest rate (as a percent) | 10% | 3% | |||||||||
Don Memo | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Commitment amount | 2,400 | $ 2,400 | |||||||||
Amount loaned | $ 700 | $ 600 | $ 700 | ||||||||
Loan receivable fixed interest rate (as a percent) | 7.25% | 7.25% | |||||||||
Infrastructure advance | 1,600 | 2,000 | |||||||||
Don Memo | Prepaid expenses and other current assets | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Infrastructure advance | $ 400 | $ 400 | 400 | ||||||||
Don Memo | Other long-term assets | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Infrastructure advance | $ 1,200 | $ 1,600 |
Basis of Presentation and Si_12
Basis of Presentation and Significant Accounting Policies - Accrued Expenses (Details) - USD ($) $ in Millions | Oct. 31, 2022 | Oct. 31, 2021 |
Basis of Presentation and Significant Accounting Policies | ||
Accrued liabilities related to goods and services | $ 28.7 | $ 32.6 |
Basis of Presentation and Si_13
Basis of Presentation and Significant Accounting Policies - Revenue and Receivables (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jul. 31, 2021 USD ($) | Oct. 31, 2022 USD ($) customer | Oct. 31, 2021 USD ($) | Oct. 31, 2020 USD ($) | Feb. 27, 2019 USD ($) | |
Significant Accounting Policies [Line Items] | |||||
Number of Customers Accounted for More Than 10% | customer | 0 | ||||
Allowances of accounts receivable | $ 4,199 | $ 4,816 | |||
Bridge loan to Agricola Belher | $ 1,700 | ||||
Proceeds received from FreshRealm Separation Agreement recovery | $ 6,000 | ||||
FreshRealm [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Bridge loan to Agricola Belher | $ 34,500 | $ 34,500 | |||
Proceeds received from FreshRealm Separation Agreement recovery | $ 6,000 | ||||
Customer concentration [Member] | Sales revenue [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Number of Customers | customer | 10 | ||||
Concentration Risk Threshold Percentage | 59% | 58% | 56% | ||
Kroger [Member] | Customer concentration [Member] | Sales revenue [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk Threshold Percentage | 15% | 16% | 18% | ||
Trader Joes [Member] | Customer concentration [Member] | Sales revenue [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk Threshold Percentage | 11% | ||||
Walmart [Member] | Customer concentration [Member] | Sales revenue [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk Threshold Percentage | 10% | 11% | 12% |
Basis of Presentation and Si_14
Basis of Presentation and Significant Accounting Policies - Consignments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Sales | $ 1,191,073 | $ 1,055,830 | $ 1,059,371 |
Cost of sales | 1,117,228 | 998,405 | 969,473 |
Gross profit | 73,845 | 57,425 | 89,898 |
Consignment Arrangements [Member] | |||
Sales | 59,748 | 52,287 | 64,922 |
Cost of sales | 53,238 | 45,945 | 57,554 |
Gross profit | $ 6,510 | $ 6,342 | $ 7,368 |
Basis of Presentation and Si_15
Basis of Presentation and Significant Accounting Policies - Advertising Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Basis of Presentation and Significant Accounting Policies | |||
Advertising costs | $ 0.6 | $ 0.4 | $ 0.4 |
Basis of Presentation and Si_16
Basis of Presentation and Significant Accounting Policies - Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Basis of Presentation and Significant Accounting Policies | |||
Research and development costs | $ 0.1 | $ 0.3 | $ 0.7 |
Investment Income, Dividend | 0.8 | 0.6 | $ 0.6 |
Consulting fees | 2.8 | 0.9 | |
Employee costs | $ 2 | $ 0.6 |
Basis of Presentation and Si_17
Basis of Presentation and Significant Accounting Policies - Income per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Basis of Presentation and Significant Accounting Policies | |||
Net loss attributable to Calavo Growers, Inc | $ (6,249) | $ (11,818) | $ (13,625) |
Weighted average shares - Basic (in shares) | 17,663,000 | 17,621,000 | 17,564,000 |
Weighted average shares - Diluted (in shares) | 17,663,000 | 17,621,000 | 17,564,000 |
Basic | $ (0.35) | $ (0.67) | $ (0.78) |
Diluted | $ (0.35) | $ (0.67) | $ (0.78) |
Antidilutive shares excluded from EPS (in shares) | 82,000 | 42,000 | 55,000 |
Basis of Presentation and Si_18
Basis of Presentation and Significant Accounting Policies - Stock-Based Compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Basis of Presentation and Significant Accounting Policies | |||
Stock-based compensation expense | $ 3,100 | $ 4,000 | $ 4,500 |
Basis of Presentation and Si_19
Basis of Presentation and Significant Accounting Policies - Foreign Currency (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Basis of Presentation and Significant Accounting Policies | |||
Foreign currency gains (losses) | $ (1) | $ 0.9 | $ (1) |
Fixed rate long term obligation fair value | $ 6 | $ 7.1 |
Basis of Presentation and Si_20
Basis of Presentation and Significant Accounting Policies - Noncontrolling Interest (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Noncontrolling Interest [Line Items] | |||
Noncontrolling interest, beginning | $ 1,368 | ||
Net income attributable to noncontrolling interest of Avocados de Jalisco | 353 | $ 104 | $ 216 |
Noncontrolling interest, ending | 1,015 | 1,368 | |
Avocados de Jalisco | |||
Noncontrolling Interest [Line Items] | |||
Noncontrolling interest, beginning | 1,368 | 1,472 | |
Net income attributable to noncontrolling interest of Avocados de Jalisco | (353) | (104) | |
Noncontrolling interest, ending | $ 1,015 | $ 1,368 | $ 1,472 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Fresh fruit | $ 16,938 | $ 17,648 |
Packing supplies and ingredients | 14,176 | 13,088 |
Finished prepared foods | 7,716 | 10,021 |
Total inventories | $ 38,830 | 40,757 |
Project Uno, Florida facility | ||
Inventory valuation reserves | $ 600 |
Property, Plant, and Equipmen_2
Property, Plant, and Equipment - Summary (Details) $ in Thousands | 12 Months Ended | |||
Oct. 18, 2021 employee | Oct. 31, 2022 USD ($) | Oct. 31, 2021 USD ($) | Oct. 31, 2020 USD ($) | |
Property, Plant and Equipment | ||||
Property plant and equipment, Gross | $ 217,439 | $ 215,597 | ||
Less accumulated depreciation and amortization | (104,129) | (97,317) | ||
Total property, plant, and equipment, net | 113,310 | 118,280 | ||
Depreciation expense | 15,000 | 14,500 | $ 13,900 | |
Amortization of financing lease assets | 1,756 | 1,799 | $ 1,000 | |
Land [Member] | ||||
Property, Plant and Equipment | ||||
Property plant and equipment, Gross | 11,008 | 11,008 | ||
Buildings and improvements [Member] | ||||
Property, Plant and Equipment | ||||
Property plant and equipment, Gross | 45,733 | 46,133 | ||
Leasehold improvements [Member] | ||||
Property, Plant and Equipment | ||||
Property plant and equipment, Gross | 19,030 | 25,114 | ||
Equipment [Member] | ||||
Property, Plant and Equipment | ||||
Property plant and equipment, Gross | 121,441 | 115,942 | ||
Information systems - hardware and software [Member] | ||||
Property, Plant and Equipment | ||||
Property plant and equipment, Gross | 11,920 | 11,598 | ||
Construction in progress [Member] | ||||
Property, Plant and Equipment | ||||
Property plant and equipment, Gross | $ 8,307 | 5,802 | ||
Project Uno, Florida facility | ||||
Property, Plant and Equipment | ||||
Employee reduction | employee | 140 | |||
Project Uno, Florida facility | Leasehold improvements [Member] | ||||
Property, Plant and Equipment | ||||
Total property, plant, and equipment, net | $ 8,800 |
Other Assets and Intangibles -
Other Assets and Intangibles - Other (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
CONSOLIDATED BALANCE SHEETS | ||
Mexican IVA (i.e. value-added) taxes receivable | $ 43,625 | $ 37,493 |
Infrastructure advances to Agricola Belher | 1,241 | 1,641 |
Bridge loan to Agricola Belher | 1,700 | |
Other | 604 | 1,366 |
Total | $ 47,170 | $ 40,500 |
Other Assets and Intangibles _2
Other Assets and Intangibles - Intangibles (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Finite-Lived Intangible Assets | |||
Accum. Amortization | $ (15,099) | $ (13,536) | |
Intangibles, net | 7,206 | 8,769 | |
Finite and indefinite lived intangible assets gross | 22,305 | 22,305 | |
Amortization expense | 1,600 | 1,600 | $ 1,100 |
Brand name intangibles [Member] | |||
Finite-Lived Intangible Assets | |||
Gross carrying value and net book value | $ 275 | 275 | |
Customer list/relationships [Member] | |||
Finite-Lived Intangible Assets | |||
Weighted-Average Useful Life | 8 years | ||
Gross Carrying Value | $ 17,340 | 17,340 | |
Accum. Amortization | (11,373) | (9,989) | |
Net Book Value | $ 5,967 | 7,351 | |
Trade names [Member] | |||
Finite-Lived Intangible Assets | |||
Weighted-Average Useful Life | 8 years | ||
Gross Carrying Value | $ 4,060 | 4,060 | |
Accum. Amortization | (3,100) | (2,980) | |
Net Book Value | $ 960 | 1,080 | |
Trade secrets/recipes [Member] | |||
Finite-Lived Intangible Assets | |||
Weighted-Average Useful Life | 9 years | ||
Gross Carrying Value | $ 630 | 630 | |
Accum. Amortization | (626) | (567) | |
Net Book Value | $ 4 | $ 63 |
Other Assets and Intangibles _3
Other Assets and Intangibles - Amortization (Details) $ in Millions | Oct. 31, 2022 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Amortization expense for 2023 | $ 1.6 |
Amortization expense for 2024 | 1.5 |
Amortization expense for 2025 | 1.5 |
Amortization expense thereafter | $ 2.4 |
Revolving Credit Facilities (De
Revolving Credit Facilities (Details) | 3 Months Ended | 12 Months Ended | ||||||
Jan. 29, 2021 USD ($) | Jul. 31, 2022 USD ($) | Apr. 30, 2022 | Oct. 31, 2022 USD ($) | Dec. 01, 2021 | Oct. 31, 2021 USD ($) shares | Jan. 28, 2021 USD ($) | Oct. 31, 2020 shares | |
Debt | ||||||||
Borrowings pursuant to credit facilities, long-term | $ 1,200,000 | $ 37,700,000 | ||||||
Limoneira | ||||||||
Debt | ||||||||
Investment shares held (in shares) | shares | 1,677,299 | 1,677,299 | ||||||
Total Facility | ||||||||
Debt | ||||||||
Credit available under borrowing agreement | $ 150,000,000 | |||||||
Letters of credit outstanding | $ 3,200,000 | $ 2,500,000 | ||||||
Revolving Credit Facility | ||||||||
Debt | ||||||||
Basis point increase | 0.25% | 50% | ||||||
Credit agreement term | 5 years | |||||||
Increase in maximum borrowing capacity | $ 20,000,000 | |||||||
Fixed charge coverage ratio | 1.20 | 1 | ||||||
Weighted average interest rate (as a percent) | 4.90% | 2.20% | ||||||
Borrowings pursuant to credit facilities, long-term | $ 1,200,000 | $ 37,700,000 | ||||||
Credit available under borrowing agreement | 100,000,000 | $ 80,000,000 | $ 80,000,000 | |||||
Remaining credit available | $ 29,900,000 | |||||||
Commitment fee (as a percent) | 0.15% | |||||||
Dividend payment | $ 5,200,000 | |||||||
Revolving Credit Facility | Minimum | ||||||||
Debt | ||||||||
Adjusted fixed charge coverage ratio | 1.20 | |||||||
Quarterly consolidated leverage ratio | 1.20% | |||||||
Revolving Credit Facility | Maximum | ||||||||
Debt | ||||||||
Quarterly consolidated leverage ratio | 2.50% | |||||||
Revolving Credit Facility | BSBY | ||||||||
Debt | ||||||||
Applicable margin (as a percent) | 3% | |||||||
Revolving Credit Facility | BSBY | Minimum | ||||||||
Debt | ||||||||
Applicable margin (as a percent) | 1.25% | 1.25% | ||||||
Revolving Credit Facility | BSBY | Maximum | ||||||||
Debt | ||||||||
Applicable margin (as a percent) | 1.75% | 1.75% | ||||||
Revolving Credit Facility | Base Rate | Minimum | ||||||||
Debt | ||||||||
Applicable margin (as a percent) | 0.25% | |||||||
Revolving Credit Facility | Base Rate | Maximum | ||||||||
Debt | ||||||||
Applicable margin (as a percent) | 0.75% | |||||||
Accordion Credit Facility | ||||||||
Debt | ||||||||
Credit available under borrowing agreement | $ 50,000,000 | $ 130,000,000 |
Commitments and Contingencies -
Commitments and Contingencies - Litigation (Details) $ in Thousands, $ in Millions | 12 Months Ended | ||||||||
Oct. 10, 2022 MXN ($) | Jun. 25, 2021 USD ($) | Jun. 16, 2021 USD ($) | Jun. 16, 2021 MXN ($) | Jul. 31, 2018 MXN ($) | Oct. 31, 2022 USD ($) | Oct. 31, 2021 USD ($) | Oct. 31, 2022 MXN ($) | Jul. 31, 2021 USD ($) | |
Commitments And Contingencies [Line Items] | |||||||||
Settlement related fees | $ 1,417 | $ 1,797 | |||||||
Mexican Tax Authority | Tax Assessment 2011 | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Tax assessment | $ 2,200 | ||||||||
Discreet tax expense (benefit) | $ 2,400 | $ 47.8 | |||||||
Mexican Tax Authority | Tax Assessment 2013 | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Tax assessment | $ 3,100 | ||||||||
Settlement related fees | 1,400 | ||||||||
Fixed assets net book value under lien | $ 26,000 | ||||||||
Amount disputed | $ 2,600 | 131,300 | |||||||
Bank accounts under lien | $ 1,000 | ||||||||
Percentage of tax on fruit purchase deposits | 16% | ||||||||
Tax dispute liability accrued | $ 11,000 | ||||||||
Estimate of loss | 151,500 | $ 3,080 | |||||||
Mexican Tax Authority | Tax Assessment 2013 | Employee Profit Sharing Liability | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Estimate of loss | $ 6,000 | $ 118 |
Related-Party Transactions (Det
Related-Party Transactions (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||||
Oct. 27, 2022 | Aug. 31, 2020 | Aug. 31, 2018 | Jul. 31, 2015 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | Jan. 31, 2022 | Jul. 31, 2021 | Jul. 31, 2018 | |
Related-Party Transactions | ||||||||||
Dividend income from Limoneira | $ 800 | $ 600 | $ 600 | |||||||
Gross proceeds for common stock | 18,450 | |||||||||
Realized and unrealized net gain (loss) on Limoneira shares | (8,605) | 3,858 | (8,537) | |||||||
Investments in unconsolidated entities | 3,782 | 4,346 | ||||||||
Advances to suppliers | 12,430 | 6,693 | ||||||||
Non-cash settlement of advance | 1,060 | 2,761 | ||||||||
Avocados de Jalisco | ||||||||||
Related-Party Transactions | ||||||||||
Purchases from related parties | $ 7,000 | 13,000 | 8,300 | |||||||
Avocados de Jalisco | Avocados de Jalisco | ||||||||||
Related-Party Transactions | ||||||||||
Subsidiary ownership (as a percent) | 83% | |||||||||
Limoneira | ||||||||||
Related-Party Transactions | ||||||||||
Dividend income from Limoneira | $ 600 | 500 | 500 | |||||||
Number of shares | 1,677,299 | |||||||||
Gross proceeds for common stock | $ 18,500 | |||||||||
Realized and unrealized net gain (loss) on Limoneira shares | (8,600) | 3,900 | (8,500) | |||||||
Rent paid | 300 | 300 | 300 | |||||||
Don Memo | ||||||||||
Related-Party Transactions | ||||||||||
Purchases from related parties | $ 13,700 | 14,700 | 15,800 | |||||||
Ownership interest (as a percent) | 50% | 50% | ||||||||
Investment in FreshRealm | $ 2,000 | |||||||||
Investments in unconsolidated entities | $ 3,800 | 4,300 | 6,100 | |||||||
Amount loaned | 2,800 | |||||||||
Advances to suppliers | 7,000 | 4,200 | $ 2,400 | |||||||
Loan receivable fixed interest rate (as a percent) | 7.25% | |||||||||
Infrastructure advance | 1,600 | 2,000 | ||||||||
Commitment amount | $ 2,400 | |||||||||
Tomato liability due to related party | 1,900 | 3,000 | 1,800 | |||||||
Don Memo | Prepaid expenses and other current assets | ||||||||||
Related-Party Transactions | ||||||||||
Infrastructure advance | 400 | 400 | ||||||||
Don Memo | Other long-term assets | ||||||||||
Related-Party Transactions | ||||||||||
Infrastructure advance | 1,200 | 1,600 | ||||||||
Directors | ||||||||||
Related-Party Transactions | ||||||||||
Purchases from related parties | 7,500 | 17,800 | 18,000 | |||||||
Accounts payable to related parties | 0 | 0 | ||||||||
Agricola Belher | ||||||||||
Related-Party Transactions | ||||||||||
Purchases from related parties | 19,400 | 16,300 | 26,900 | |||||||
Amount loaned | $ 3,000 | |||||||||
Advances to suppliers | 4,500 | 4,500 | 4,500 | |||||||
Annual repayment of advances | $ 900 | 600 | ||||||||
Loan receivable fixed interest rate (as a percent) | 7.25% | 10% | ||||||||
Term of loans receivables | 2 years | |||||||||
Infrastructure advance | $ 3,000 | 900 | $ 1,800 | |||||||
Commitment amount | 4,500 | $ 4,500 | ||||||||
Bridge loan to related parties | $ 3,500 | |||||||||
Expected payment 2022 | $ 900 | 900 | ||||||||
Expected payment 2023 | 900 | 900 | ||||||||
Expected payment 2024 | $ 1,700 | $ 1,700 | ||||||||
Non-cash settlement of advance | 1,100 | |||||||||
Agricola Belher | LIBOR | ||||||||||
Related-Party Transactions | ||||||||||
Advances variable interest rate (as a percent) | 10% | 3% | ||||||||
Agricola Belher | Prepaid expenses and other current assets | ||||||||||
Related-Party Transactions | ||||||||||
Bridge loan to related parties | 900 | |||||||||
Agricola Belher | Other long-term assets | ||||||||||
Related-Party Transactions | ||||||||||
Bridge loan to related parties | $ 1,700 |
Income Taxes - Provision (Benef
Income Taxes - Provision (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Current: | |||
Federal | $ 2,012 | $ (3,449) | $ (5,684) |
State | 147 | 323 | (214) |
Foreign | 1,209 | 16,703 | 645 |
Total current | 3,368 | 13,577 | (5,253) |
Deferred: | |||
Federal | (162) | 790 | 576 |
State | 746 | (343) | (505) |
Foreign | (701) | (3,934) | 260 |
Total deferred | (117) | (3,487) | 331 |
Change in valuation allowance | 657 | 630 | |
Total income tax provision (benefit) | $ 3,251 | $ 10,747 | $ (4,292) |
Income Taxes - Deferred Taxes A
Income Taxes - Deferred Taxes Assets (Liabilities) (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Income Taxes | ||
Gross deferred tax assets | $ 23,500 | $ 29,300 |
Gross deferred tax liabilities | 16,200 | 22,700 |
Property, plant, and equipment | (2,002) | (4,764) |
Intangible assets | 2,828 | 5,051 |
Unrealized gain, Limoneira investment | (1,138) | |
Stock-based compensation | 715 | 511 |
State taxes | 6 | (498) |
Credits and incentives | 1,194 | 1,808 |
Allowance for accounts receivable | 936 | 1,259 |
Inventories | 442 | 507 |
Accrued liabilities | 1,143 | 2,067 |
Operating lease - Right of use assets | (13,723) | (15,839) |
Operating lease liabilities | 14,861 | 17,040 |
Net operating loss | 549 | 1,093 |
Valuation allowance | (1,830) | (1,291) |
Capital loss carryover | 804 | |
Other | (490) | (490) |
Long-term deferred income taxes | 5,433 | 5,316 |
State | ||
Income Taxes | ||
Operating loss carryforwards | 9,100 | 19,000 |
Operating loss carryforwards allowance | 1,800 | 1,200 |
Federal | ||
Income Taxes | ||
Operating loss carryforwards | 0 | $ 0 |
Operating loss carryforwards allowance | $ 600 |
Income Taxes - Rate reconciliat
Income Taxes - Rate reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Federal statutory tax rate | 21% | 21% | 21% |
State taxes, net of federal effects | (1.30%) | 11.60% | 4.40% |
Rate differential on NOL carryback | 125.80% | 6.20% | |
Foreign income taxes greater than U.S. | 5.20% | 16.10% | (2.30%) |
Uncertain tax positions | 5.10% | (1059.90%) | |
Stock based compensation | (6.10%) | (16.70%) | |
Provision to return | (59.90%) | 39.20% | (2.50%) |
State rate change | (2.50%) | 9.20% | (0.10%) |
Valuation allowance | (24.20%) | (44.10%) | (2.70%) |
Other permanent differences | (33.80%) | ||
Other | (0.50%) | (15.50%) | (0.30%) |
Effective Income Tax Rate, Total | (97.00%) | (913.30%) | 23.70% |
Domestic operations income (loss) before taxes | $ (1,400) | $ (5,000) | $ (18,900) |
Income tax refunds | 6,700 | ||
Foreign operations income (loss) before taxes | (1,900) | 3,800 | 800 |
Unrecognized tax benefits | 11,131 | 11,303 | $ 72 |
Tax Assessment 2013 | |||
Unrecognized tax benefits | $ 11,100 | $ 11,300 |
Income Taxes - Unrecognized (De
Income Taxes - Unrecognized (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 31, 2022 | Oct. 31, 2021 | |
Reconciliation of gross unrecognized taxes | ||
Beginning balance | $ 11,303 | $ 72 |
Reductions based on tax positions related to prior periods | (172) | |
Gross increase - Tax positions in prior periods | 131 | |
Gross increase - Tax positions in current period | 11,100 | |
Ending balance | 11,131 | $ 11,303 |
Accrued interest and penalties | $ 0 |
Segment Information - Gross Pro
Segment Information - Gross Profit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Segment reporting information | |||
Net sales | $ 1,191,073 | $ 1,055,830 | $ 1,059,371 |
Cost of sales | 1,117,228 | 998,405 | 969,473 |
Gross profit | 73,845 | 57,425 | 89,898 |
Elimination between Grown products and Prepared products | |||
Segment reporting information | |||
Sales and cost of sales eliminated | 2,100 | 2,500 | 1,700 |
Operating segments | Grown [Member] | |||
Segment reporting information | |||
Net sales | 700,270 | 588,527 | 585,052 |
Cost of sales | 650,105 | 540,740 | 537,489 |
Gross profit | 50,165 | 47,787 | 47,563 |
Operating segments | Prepared [Member] | |||
Segment reporting information | |||
Net sales | 492,868 | 469,800 | 475,970 |
Cost of sales | 469,188 | 460,162 | 433,635 |
Gross profit | 23,680 | 9,638 | 42,335 |
Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Net sales | (2,065) | (2,497) | (1,651) |
Cost of sales | $ (2,065) | $ (2,497) | $ (1,651) |
Segment Information - Product (
Segment Information - Product (Details) $ in Thousands | 12 Months Ended | |||
Apr. 13, 2022 segment | Oct. 31, 2022 USD ($) segment | Oct. 31, 2021 USD ($) | Oct. 31, 2020 USD ($) | |
Segment reporting information | ||||
Number of reportable segments | segment | 2 | 2 | ||
Goodwill | $ 28,653 | $ 28,653 | ||
Total gross sales | 1,207,768 | 1,073,686 | $ 1,071,084 | |
Less sales allowances | (14,630) | (15,359) | (10,062) | |
Net sales | 1,191,073 | 1,055,830 | 1,059,371 | |
Avocados [Member] | ||||
Segment reporting information | ||||
Total gross sales | 645,944 | 536,969 | 521,542 | |
Tomatoes [Member] | ||||
Segment reporting information | ||||
Total gross sales | 47,288 | 43,658 | 53,922 | |
Papayas [Member] | ||||
Segment reporting information | ||||
Total gross sales | 11,422 | 10,884 | 10,529 | |
Other fresh income [Member] | ||||
Segment reporting information | ||||
Total gross sales | 123 | 693 | 327 | |
Fresh-cut fruit | ||||
Segment reporting information | ||||
Total gross sales | 204,433 | 205,087 | 204,766 | |
Fresh-cut vegetables | ||||
Segment reporting information | ||||
Total gross sales | 107,332 | 102,291 | 113,460 | |
Prepared products | ||||
Segment reporting information | ||||
Total gross sales | 114,396 | 95,639 | 88,346 | |
Guacamole | ||||
Segment reporting information | ||||
Total gross sales | 74,970 | 75,681 | 75,409 | |
Salsa | ||||
Segment reporting information | ||||
Total gross sales | 1,860 | 2,784 | 2,783 | |
Grown [Member] | ||||
Segment reporting information | ||||
Goodwill | 4,000 | 4,000 | ||
Total gross sales | 704,777 | 592,204 | 586,320 | |
Less sales allowances | (4,507) | (3,677) | (1,268) | |
Net sales | 698,205 | 586,030 | 583,401 | |
Grown [Member] | Avocados [Member] | ||||
Segment reporting information | ||||
Total gross sales | 645,944 | 536,969 | 521,542 | |
Grown [Member] | Tomatoes [Member] | ||||
Segment reporting information | ||||
Total gross sales | 47,288 | 43,658 | 53,922 | |
Grown [Member] | Papayas [Member] | ||||
Segment reporting information | ||||
Total gross sales | 11,422 | 10,884 | 10,529 | |
Grown [Member] | Other fresh income [Member] | ||||
Segment reporting information | ||||
Total gross sales | 123 | 693 | 327 | |
Prepared [Member] | ||||
Segment reporting information | ||||
Goodwill | 24,700 | 24,700 | ||
Total gross sales | 502,991 | 481,482 | 484,764 | |
Less sales allowances | (10,123) | (11,682) | (8,794) | |
Net sales | 492,868 | 469,800 | 475,970 | |
Prepared [Member] | Fresh-cut fruit | ||||
Segment reporting information | ||||
Total gross sales | 204,433 | 205,087 | 204,766 | |
Prepared [Member] | Fresh-cut vegetables | ||||
Segment reporting information | ||||
Total gross sales | 107,332 | 102,291 | 113,460 | |
Prepared [Member] | Prepared products | ||||
Segment reporting information | ||||
Total gross sales | 114,396 | 95,639 | 88,346 | |
Prepared [Member] | Guacamole | ||||
Segment reporting information | ||||
Total gross sales | 74,970 | 75,681 | 75,409 | |
Prepared [Member] | Salsa | ||||
Segment reporting information | ||||
Total gross sales | 1,860 | 2,784 | 2,783 | |
Intersegment Eliminations [Member] | ||||
Segment reporting information | ||||
Net sales | (2,065) | (2,497) | (1,651) | |
Intersegment Eliminations [Member] | Grown [Member] | ||||
Segment reporting information | ||||
Net sales | $ (2,065) | $ (2,497) | $ (1,651) |
Segment Information - Concentra
Segment Information - Concentrations (Details) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 USD ($) customer | Oct. 31, 2021 USD ($) customer | Oct. 31, 2020 customer | |
Segment reporting information | |||
Goodwill | $ | $ 28,653 | $ 28,653 | |
Prepared [Member] | |||
Segment reporting information | |||
Goodwill | $ | 24,700 | 24,700 | |
Grown [Member] | |||
Segment reporting information | |||
Goodwill | $ | $ 4,000 | $ 4,000 | |
Sales revenue [Member] | Customer concentration [Member] | |||
Segment reporting information | |||
Number of customers | customer | 10 | ||
Concentration Risk Threshold Percentage | 59% | 58% | 56% |
Sales revenue [Member] | Customer concentration [Member] | Prepared [Member] | |||
Segment reporting information | |||
Number of customers | customer | 1 | 1 | 1 |
Sales revenue [Member] | Customer concentration [Member] | Grown [Member] | |||
Segment reporting information | |||
Number of customers | customer | 1 | 1 | 1 |
Minimum | Sales revenue [Member] | Customer concentration [Member] | Prepared [Member] | |||
Segment reporting information | |||
Concentration Risk Threshold Percentage | 10% | 10% | 10% |
Minimum | Sales revenue [Member] | Customer concentration [Member] | Grown [Member] | |||
Segment reporting information | |||
Concentration Risk Threshold Percentage | 10% | 10% |
Segment Information - Geographi
Segment Information - Geographic (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Segment reporting information | |||
Net sales | $ 1,191,073 | $ 1,055,830 | $ 1,059,371 |
Long-lived assets | 113,310 | 118,280 | |
Outside United States | |||
Segment reporting information | |||
Net sales | 27,800 | 34,800 | $ 29,700 |
United States | |||
Segment reporting information | |||
Long-lived assets | 77,208 | 81,059 | |
Mexico | |||
Segment reporting information | |||
Long-lived assets | $ 36,102 | $ 37,221 |
Long-Term Obligations - Summary
Long-Term Obligations - Summary (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Long-Term Obligations | ||
Finance leases | $ 6,021 | $ 7,140 |
Less current portion | $ (1,574) | $ (1,587) |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Long-term Debt and Capital Lease Obligations, Current | Long-term Debt and Capital Lease Obligations, Current |
Finance lease liability, noncurrent | $ 4,447 | $ 5,553 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Long-term Debt and Capital Lease Obligations | Long-term Debt and Capital Lease Obligations |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||||||||
Apr. 01, 2022 $ / shares shares | Feb. 01, 2022 $ / shares shares | Jan. 20, 2022 USD ($) $ / shares shares | Jan. 03, 2022 USD ($) $ / shares shares | Dec. 13, 2021 $ / shares shares | Nov. 02, 2020 $ / shares shares | Dec. 18, 2019 $ / shares shares | Dec. 31, 2022 $ / shares shares | Sep. 30, 2021 USD ($) $ / shares shares | Jun. 30, 2021 shares | Apr. 30, 2021 USD ($) shares | Jan. 31, 2020 director $ / shares shares | Jan. 31, 2019 $ / shares | Oct. 31, 2022 USD ($) $ / shares shares | Jul. 31, 2022 $ / shares shares | Oct. 31, 2022 USD ($) $ / shares shares | Oct. 31, 2022 USD ($) $ / shares shares | Oct. 31, 2021 USD ($) | Oct. 31, 2020 USD ($) | Apr. 30, 2011 shares | |
Share-based Compensation | ||||||||||||||||||||
Stock-based compensation expense | $ | $ 3,100 | $ 4,000 | $ 4,500 | |||||||||||||||||
Restricted stock | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 34,269 | 64 | ||||||||||||||||||
Forfeited, Number of Shares | 9 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 41.88 | |||||||||||||||||||
Vesting period | 3 years | |||||||||||||||||||
Stock-based compensation expense | $ | $ 2,300 | 4,000 | ||||||||||||||||||
Restricted stock | Officer | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 5,355 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 40.53 | |||||||||||||||||||
Vesting period | 2 years | |||||||||||||||||||
Stock-based compensation expense | $ | 100 | |||||||||||||||||||
Restricted stock | Directors | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 28,140 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 42.64 | |||||||||||||||||||
Stock-based compensation expense | $ | $ 1,000 | |||||||||||||||||||
Number of shares granted per Director | 2,814 | |||||||||||||||||||
Restricted stock | Brian Kocher (CEO) | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 28,993 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 41.39 | |||||||||||||||||||
Vesting period | 3 years | |||||||||||||||||||
Stock-based compensation expense | $ | $ 700 | $ 300 | $ 300 | 700 | ||||||||||||||||
Restricted stock | Key Employees | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Vesting period | 2 years | |||||||||||||||||||
Restricted stock | Shawn Munsell (CFO) | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Forfeited, Number of Shares | 5,598 | |||||||||||||||||||
Stock-based compensation expense | $ | 100 | |||||||||||||||||||
Restricted stock | Non-employee directors [Member] | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 16,500 | 18,000 | ||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 67.97 | $ 87.21 | ||||||||||||||||||
Vesting period | 1 year | 1 year | ||||||||||||||||||
Stock-based compensation expense | $ | $ 200 | 1,100 | ||||||||||||||||||
Number of non-employee directors | director | 12 | |||||||||||||||||||
Per employee restricted shares granted (in shares) | 1,500 | 1,500 | ||||||||||||||||||
Restricted stock | Executive officers [Member] | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 9,334 | 31,158 | ||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 67.97 | $ 87.63 | ||||||||||||||||||
Stock-based compensation expense | $ | 200 | $ 1,000 | ||||||||||||||||||
Annual incremental vesting percentage | 33% | |||||||||||||||||||
Unrestricted Stock | Directors | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 1,500 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 41.73 | |||||||||||||||||||
Stock-based compensation expense | $ | $ 100 | |||||||||||||||||||
RSU and PRSU | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Forfeited, Number of Shares | 4,014 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 37.49 | $ 34.51 | ||||||||||||||||||
Vesting period | 3 years | |||||||||||||||||||
Stock-based compensation expense | $ | 600 | |||||||||||||||||||
Fair value, non option | $ | 2,200 | |||||||||||||||||||
Unrecognized stock based compensation expenses | $ | $ 2,200 | $ 2,200 | $ 2,200 | |||||||||||||||||
Unrecognized compensation cost period | 2 years | |||||||||||||||||||
RSU | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 101,800 | 22,000 | ||||||||||||||||||
Forfeited, Number of Shares | 8,000 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 41.56 | |||||||||||||||||||
Vesting period | 3 years | |||||||||||||||||||
Stock-based compensation expense | $ | $ 800 | |||||||||||||||||||
RSU | Helen Kurtz and Vice President [Member] | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Vesting period | 3 years | |||||||||||||||||||
RSU | Shawn Munsell (CFO) | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 9,002 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 38.88 | |||||||||||||||||||
RSU | Vice President | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 2,341 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 42.71 | |||||||||||||||||||
RSU | Danny Demas | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 3,533 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 42.46 | |||||||||||||||||||
RSU | Helen Kurtz | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 6,778 | |||||||||||||||||||
Stock closing price awarded (in dollars per share) | $ / shares | $ 44.26 | |||||||||||||||||||
RSU | Shawn Munsell (CFO) and Danny Demas [Member] | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Stock-based compensation expense | $ | $ 100 | |||||||||||||||||||
PRSU | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Shares granted (in shares) | 34,269 | 66,228 | ||||||||||||||||||
Vesting period | 3 years | 3 years | ||||||||||||||||||
Stock options | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Award expiration period | 5 years | |||||||||||||||||||
Vesting period | 2 years | |||||||||||||||||||
Options granted (in shares) | 5,000 | |||||||||||||||||||
Option grant date fair value (in dollars per share) | $ / shares | $ 39.20 | |||||||||||||||||||
Option grant date fair value | $ | $ 200 | |||||||||||||||||||
2011 Management Incentive Plan [Member] | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Common stock shares authorized (in shares) | 1,500,000 | |||||||||||||||||||
2020 Management Incentive Plan [Member] | ||||||||||||||||||||
Share-based Compensation | ||||||||||||||||||||
Common stock shares authorized (in shares) | 1,500,000 | |||||||||||||||||||
Award expiration period | 5 years |
Stock-Based Compensation - Non-
Stock-Based Compensation - Non-options (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |
Apr. 01, 2022 | Dec. 31, 2022 | Oct. 31, 2022 | Oct. 31, 2022 | |
Restricted stock | ||||
Share-based Compensation | ||||
Outstanding, Number of Shares, Beginning Balance | 43 | |||
Vested, Number of Shares | (31) | |||
Forfeited, Number of Shares | (9) | |||
Granted, Number of Shares | 34,269 | 64 | ||
Outstanding, Number of Shares, Ending Balance | 67 | 67 | ||
Outstanding, Weighted-Average Exercise Price, beginning balance | $ 64.89 | |||
Vested, Weighted-Average Grant Price | 45.44 | |||
Forfeited, Weighted-Average Grant Price | 37.67 | |||
Granted, Weighted-Average Grant Price | 41.88 | |||
Outstanding, Weighted-Average Exercise Price, ending balance | $ 45.01 | $ 45.01 | ||
Aggregate Intrinsic Value | $ 2,318 | $ 2,318 | ||
RSU | ||||
Share-based Compensation | ||||
Outstanding, Number of Shares, Beginning Balance | 69,000 | |||
Forfeited, Number of Shares | (8,000) | |||
Granted, Number of Shares | 101,800 | 22,000 | ||
Outstanding, Number of Shares, Ending Balance | 83,000 | 83,000 | ||
Outstanding, Weighted-Average Exercise Price, beginning balance | $ 37.49 | |||
Forfeited, Weighted-Average Grant Price | 37.49 | |||
Granted, Weighted-Average Grant Price | 41.56 | |||
Outstanding, Weighted-Average Exercise Price, ending balance | $ 38.57 | $ 38.57 | ||
Aggregate Intrinsic Value | $ 3,253 | $ 3,253 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option (Details) - Stock options - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | |
Oct. 31, 2022 | Oct. 31, 2021 | |
Share-based Compensation | ||
Outstanding, Number of Shares, Beginning Balance | 19 | |
Exercised, Number of Shares | (2) | |
Outstanding, Number of Shares, Ending Balance | 17 | 19 |
Exercisable, Number of Shares | 12 | |
Outstanding, Weighted-Average Exercise Price | $ 42.89 | |
Exercised, Weighted-Average Exercise Price | 23.48 | |
Outstanding, Weighted-Average Exercise Price, ending balance | 47.62 | $ 42.89 |
Exercisable, Weighted-Average Exercise Price | $ 51.12 | |
Outstanding stock options, weighted-average remaining contractual term | 1 year 6 months | |
Exercisable stock options, weighted-average remaining contractual term | 2 years 4 months 24 days | |
Estimated fair market value of options | $ 0.1 |
Dividends (Details)
Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||
Dec. 14, 2022 | Dec. 03, 2021 | Oct. 29, 2021 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Dividends | ||||||
Dividend declared per share | $ 0.2875 | $ 1.15 | $ 1.15 | $ 1.15 | ||
Dividend amount paid to shareholders | $ 5,200 | $ 20,300 | $ 20,330 | $ 20,343 | $ 19,354 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Oct. 27, 2022 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Assets at Fair Value: | ||||
Realized and unrealized net gain (loss) on Limoneira shares | $ (8,605) | $ 3,858 | $ (8,537) | |
Gross proceeds for common stock | 18,450 | |||
Limoneira | ||||
Assets at Fair Value: | ||||
Limoneira's stock price | $ 16.13 | $ 13.83 | ||
Limoneira | ||||
Assets at Fair Value: | ||||
Investment shares held (in shares) | 1,677,299 | 1,677,299 | ||
Realized and unrealized net gain (loss) on Limoneira shares | (8,600) | $ 3,900 | $ (8,500) | |
Number of securities sold | 1,677,299 | |||
Gross proceeds for common stock | $ 18,500 | |||
Fair Value, recurring | ||||
Assets at Fair Value: | ||||
Total assets at fair value | 27,055 | |||
Fair Value of financial assets and liabilities | $ 0 | |||
Fair Value, recurring | Limoneira | ||||
Assets at Fair Value: | ||||
Investment in Limoneira Company | 27,055 | |||
Fair Value, recurring | Level 1 | ||||
Assets at Fair Value: | ||||
Total assets at fair value | 27,055 | |||
Fair Value, recurring | Level 1 | Limoneira | ||||
Assets at Fair Value: | ||||
Investment in Limoneira Company | $ 27,055 |
Mexican IVA taxes receivable (D
Mexican IVA taxes receivable (Details) $ in Millions, $ in Millions | 1 Months Ended | |||||
Apr. 30, 2022 USD ($) | Oct. 31, 2022 USD ($) | Oct. 31, 2022 MXN ($) | Apr. 30, 2022 MXN ($) | Oct. 31, 2021 USD ($) | Oct. 31, 2021 MXN ($) | |
IVA receivables | ||||||
IVA receivables balance | $ 43.6 | $ 865.4 | $ 37.5 | $ 762.1 | ||
Unrecoverable value added tax | $ 0.3 | $ 6.9 | ||||
Minimum | ||||||
IVA receivables | ||||||
Estimated term for resolution of law suits | 2 years | |||||
Maximum | ||||||
IVA receivables | ||||||
Estimated term for resolution of law suits | 3 years |
FreshRealm Separation (Details)
FreshRealm Separation (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Feb. 03, 2021 | Jul. 31, 2021 | Jul. 31, 2020 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | Feb. 27, 2019 | |
Related Party Transaction [Line Items] | |||||||
Bridge loan to Agricola Belher | $ 1,700 | ||||||
Loss on reserve | $ (6,130) | $ 37,322 | |||||
Proceeds received for repayment of related party loan | 6,000 | ||||||
FreshRealm [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Bridge loan to Agricola Belher | $ 34,500 | $ 34,500 | |||||
Loss on reserve | $ 34,500 | ||||||
Proceeds received for repayment of related party loan | $ 6,000 | ||||||
Receivable proceeds event of sale (as a percent) | 20% | ||||||
Threshold values of the private placement for VIE company | $ 35,000 | ||||||
Amount of sale or success event | $ 0 | $ 0 | |||||
FreshRealm [Member] | Success Event is equal to or greater than $100 million, but less than $230 million | |||||||
Related Party Transaction [Line Items] | |||||||
Receivable upon closing of success event | 10,000 | ||||||
Value threshold of success event | 100,000 | ||||||
FreshRealm [Member] | Success Event is equal to or greater than $100 million, but less than $230 million | Minimum | |||||||
Related Party Transaction [Line Items] | |||||||
Value threshold of success event | 100,000 | ||||||
FreshRealm [Member] | Success Event is equal to or greater than $100 million, but less than $230 million | Maximum | |||||||
Related Party Transaction [Line Items] | |||||||
Value threshold of success event | 230,000 | ||||||
FreshRealm [Member] | Success Event is equal to or greater than $230 million, but less than $380 million | |||||||
Related Party Transaction [Line Items] | |||||||
Receivable upon closing of success event | 20,000 | ||||||
FreshRealm [Member] | Success Event is equal to or greater than $230 million, but less than $380 million | Minimum | |||||||
Related Party Transaction [Line Items] | |||||||
Value threshold of success event | 230,000 | ||||||
FreshRealm [Member] | Success Event is equal to or greater than $230 million, but less than $380 million | Maximum | |||||||
Related Party Transaction [Line Items] | |||||||
Value threshold of success event | 380,000 | ||||||
FreshRealm [Member] | Success Event is equal to or greater than $380 Million | |||||||
Related Party Transaction [Line Items] | |||||||
Receivable upon closing of success event | 34,000 | ||||||
Value threshold of success event | 380,000 | ||||||
FreshRealm [Member] | Promissory Notes | |||||||
Related Party Transaction [Line Items] | |||||||
Amount loaned | 5,000 | ||||||
Loan payoff amount | $ 6,000 | ||||||
Proceeds received for repayment of related party loan | $ 6,000 |
Leases - Assets and Liabilities
Leases - Assets and Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | Nov. 01, 2019 | Oct. 31, 2019 | |
Leases | |||||
Operating lease liability | $ 59,065 | ||||
Other long-term liabilities | 2,635 | $ 3,081 | |||
Total shareholders' equity | $ 223,371 | 226,883 | $ 256,002 | $ 285,869 | |
Lease, Practical Expedients, Package [true false] | true | ||||
Lease-related assets and liabilities | |||||
Operating lease assets | $ 54,518 | 59,842 | |||
Finance lease asset | $ 5,721 | $ 6,907 | |||
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | |||
Total | $ 60,239 | $ 66,749 | |||
Current portion of operating leases | 6,925 | 6,817 | |||
Finance lease liability, current | $ 1,574 | $ 1,587 | |||
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Long-term Debt and Capital Lease Obligations, Current | Long-term Debt and Capital Lease Obligations, Current | |||
Long-term operating leases, less current portion | $ 52,140 | $ 57,561 | |||
Finance lease liability, noncurrent | $ 4,447 | $ 5,553 | |||
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Long-term Debt and Capital Lease Obligations | Long-term Debt and Capital Lease Obligations | |||
Total | $ 65,086 | $ 71,518 | |||
Weighted-average remaining lease term: Operating leases | 9 years 3 months 18 days | 10 years 1 month 6 days | |||
Weighted-average remaining lease term: Finance leases | 6 years 10 months 24 days | 7 years 1 month 6 days | |||
Weighted-average discount rate: Operating leases | 2.87% | 2.80% | |||
Weighted-average discount rate: Finance leases | 3.62% | 3.20% | |||
Cumulative effect adjustment | ASU, Leases | |||||
Leases | |||||
Operating lease liability | $ 69,600 | ||||
Deferred rent and incentives | (3,700) | ||||
Other long-term liabilities | (1,200) | ||||
Total shareholders' equity | 900 | ||||
Lease-related assets and liabilities | |||||
Operating lease assets | $ 65,700 |
Leases - Costs and Other Inform
Leases - Costs and Other Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Lease costs | |||
Amortization of financing lease assets | $ 1,756 | $ 1,799 | $ 1,000 |
Operating lease cost | 8,733 | 9,152 | |
Short-term lease cost | 2,483 | 2,981 | |
Sublease income | (30) | (704) | |
Variable lease cost | 133 | 275 | |
Interest on financing lease liabilities | 213 | 235 | |
Total lease cost | 13,288 | 13,738 | |
Operating cash flows for operating leases | 7,012 | 7,200 | |
Financing cash flows for finance leases | 1,683 | 1,672 | |
Operating cash flows for finance leases | 213 | 235 | |
Right of use assets obtained for operating lease | $ 1,000 | $ 1,000 |
Leases - Undiscounted Future Pa
Leases - Undiscounted Future Payments (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Operating Leases | ||
2023 | $ 8,494 | |
2024 | 8,311 | |
2025 | 7,212 | |
2026 | 6,737 | |
2027 | 6,348 | |
Thereafter | 30,411 | |
Total lease payments | 67,513 | |
Less: imputed interest | 8,448 | |
Operating lease liability | 59,065 | |
Finance Leases | ||
2023 | 1,778 | |
2024 | 1,280 | |
2025 | 786 | |
2026 | 495 | |
2027 | 371 | |
Thereafter | 2,162 | |
Total lease payments | 6,872 | |
Less: imputed interest | 851 | |
Finance lease liability | $ 6,021 | $ 7,140 |
Closure of Prepared's Florida_3
Closure of Prepared's Florida facility (Details) $ in Thousands | 12 Months Ended | ||
Oct. 18, 2021 employee | Oct. 31, 2022 USD ($) | Oct. 31, 2021 USD ($) | |
Closure | |||
Operating lease right-of-use assets | $ 54,518 | $ 59,842 | |
Operating lease liability | 59,065 | ||
Impairment and other charges | |||
Impairment of Long-Lived Assets Held-for-use | 0 | 0 | |
Incremental restructuring and related costs | 317 | 9,748 | |
Property, plant, and equipment, net | 113,310 | 118,280 | |
Project Uno, Florida facility | |||
Closure | |||
Employee reduction | employee | 140 | ||
Operating lease right-of-use assets | 4,000 | 4,800 | |
Operating lease liability | 5,300 | 6,000 | |
Impairment and other charges | |||
Leasehold improvements | 8,731 | ||
Inventory | 586 | ||
Employee severance | 352 | ||
Impairment charges | $ 300 | ||
Other assets | 79 | ||
Incremental restructuring and related costs | 9,748 | ||
Project Uno, Florida facility | Leasehold improvements [Member] | |||
Impairment and other charges | |||
Property, plant, and equipment, net | $ 8,800 |
Sale of Investment in Limonei_2
Sale of Investment in Limoneira (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 27, 2022 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Equity investment | ||||
Proceeds received from Limoneira stock sales | $ 18,450 | |||
Realized and unrealized net gain (loss) on Limoneira shares | (8,605) | $ 3,858 | $ (8,537) | |
Limoneira | ||||
Equity investment | ||||
Number of securities sold | 1,677,299 | |||
Proceeds received from Limoneira stock sales | $ 18,500 | |||
Realized and unrealized net gain (loss) on Limoneira shares | $ (8,600) | $ 3,900 | $ (8,500) |