Earnings call transcript Q1 2023

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Operator

Greetings, and welcome to Limoneira’s First Quarter Fiscal Year 2023 Financial Results Conference Call. At this time, all participants are in listen-only mode, and the question-and-answer session will follow the formal presentation. [Operator Instructions].

As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, John Mills with ICR. you. Thank

begin. may You

John Mills

and fiscal for year everyone, Limoneira’s us first quarter XXXX thank afternoon, joining you for Good conference call.

today Mark Officer. call Executive the are President Edwards, On and Officer; and Palamountain, Financial Chief Harold Chief

fiscal By now, access Eastern at earnings have everyone Time. today which out X.XX year first went to release, approximately XXXX the should quarter PM

at is portion view available on it’s webcast you not of company’s replay available If the release, will have call had site on the a limoneira.com. Web a and Limoneira’s site Investor being as chance Relations This to be the well. Web

of we performance performance to a and remind everyone management number or of by required Before update as of statements Except we release. questions. achievements obligation implied the future could contribute law, events to information, outside uncertainties, unknown in new that earnings company’s the statements additional factors the and results, and achievements detailed like that make results, your forward-looking statements whether risk include as forward-looking XX-Qs contain statements. such no known mentioned and the the we cause begin, Important may any response or or company’s differences such those in would and undertake involve XX-Ks in filed risks to prepared other SEC or future statements to from result and to forward-looking could by herein, a remarks with which cause are or forward-looking or its expressed significantly many differ control Such otherwise.

adjusted much results understanding an as underlying particularly are detail We We facilitate more greater results of possible as measures, be provide will results financial complete analysis discussing measures on from of can Please financial a discussed note comparing that any we on adjusted call, on an period basis. adjusted these basis. during including and that to period. items Limoneira’s when believe ongoing today’s non-GAAP operations,

release and earnings include adjusted net non-GAAP company’s remarks, share, Also, and common adjusted within in net reconciliation financial directly EPS measures. included financial per company’s share, are has adjusted loss are of diluted share net in diluted per we most the EBITDA, per prepared GAAP loss loss press its earnings comparable A to common per today’s been diluted net adjusted the which measures release, Web EBITDA, the and to loss posted site. diluted which per

company’s And Mr. that, the my pleasure turn over with Harold to is President the CEO, it call Edwards. and to

Harold Edwards

first softer rains and portion $XX to and first good second the seasonally harvest Thanks, the the volume everyone. the the in pleased revenue the generated million Despite expect am of into had in crops full in XXXX pushing afternoon, John, We the delayed California heavy guidance over harvest the our fully our lemon and quarter. year quarter. our I we rain quarters, revenue from and initial of performance to second a with quarter, avocado third intact. damage minimal our in recoup keeping quarter

year. fiscal pricing the in second lemon expect increase we to half fresh for cartons the Additionally, of

a in debt, efforts, more and strategic initial plan. believe capital. return plan approximately This improve new streamline monetization to to in right-size operating of the transition that balance listening operations value sale, recap share, investors our quickly now and EBITDA worth realized to of efficient which pivoting sheet identification assets sell million of our and on approximately is improve we today, per because like greater invested involve call the a and are the business $XXX $XXX dividends model for consistency order million to an our transition For non-strategic our asset-lighter towards increase would earnings, of assets, I our reduce plan the

nearly which all balance the top of our identified from positioning Limoneira, be to recruitment our and X month with us advancing our results. strategic improve progress Board additional planning Management grower our our One assets of balance significant Directors will initiative expanding new plan, our and sold, line We've sheet to made of and to transforming strong sheet. into allocation taking bottom our at million of close World partners with all strategic new Harvest for annual to meeting non-strategic are those a implement assets this session of with on account strategy capital cartons certain Citrus monetize executing very

$XXX for transformative sheet value. have and of with closing balance significantly successfully as approximately strengthen earnings million the to Properties us will the in XXXX sale shareholder six assets to strategic million The our $XX past total quarter sale of $XX.X the from basis proceeds. in EBITDA closed pro were of net million maximize pursue We most of used four to our of by ended the reduce Northern debt cash accretive and announced be the position a Northern We to sale is a proceeds months on identified first proceeds. a the on six range Properties to end for the over year forma net XX% enable expected opportunities is the

our that acres, keep us looking X,XXX X,XXX made property The buyer Properties, open we for supply we of of space. When of to acres, acres XXX intact. find ground and XXX planted were our allowed it a of one lemon imperative up of chain Northern consists acres was that plantable

services the Limoneira grower press as Investments transaction, term into related and agreement Agricultural a As period. on a five-year announced services we the this in out marketing for services initial the release, property for and of a to packing, provide farm property one management minimum sale part selling provide entered to lemons entered into marketing and and agreement Prudential laid harvested to for packing an of farming year

global with using using partner grower leveraging marketing is The squarely This of strategic of grower focus pricing with packing, farming of per leading business reduces economics asset-lighter fits share volatility extremely selling with carton we additive outlay. to on be margin, expand rising to our attractive pro targeting Limoneira capital It EBITDA One a of on earnings our $X.XX World the an and basis. to services forma partners piece Citrus plan $X.XX and and our additional fruit. as our impact transaction of the and in per way, no will on more also costs

chain. to through become our our and have very We our services to attractive technology investments to partners continue and bolster grow best-in-class develop supply appeal grower in

the over strategic in Our at lemons our to throughout largest XX%. the market. approximately to our with was who utilization fresh fresh prices successfully partners. marketing and competitive one sold to we XXXX, This enables lemons is fresh sales important utilization year with of compared an team fresh approach best rates of fiscal In competitor year [ph] XX% market grower the draw at obviously

year lemon In number from packing these roughly source quarter are fresh U.S. global of reducing and We working also lemons better still that pack This our packing certain goal globally, of reconfiguring and to to fiscal by the the maintaining on to XX% orange lemon have grown network. our of and XXXX, the locations. is our our closer includes came while grower XX%. first support lemon grower acreage partners marketing partners volume

part Prudential the improvement see to returns and begin next packing, predictable that will XX a with months. is example you marketing focus structure great of Properties XX business Agricultural selling. to with return, deal And a stable of on are lot we of over and we on The our Northern and direction the in headed, Investments our margins, better our as service meaningful earnings cash capital become to invested more the flow growing

usage remaining our Northern to over Properties after the XX,XXX that XX owned approximately have with own transaction, assets, as and rights we pumping water million in next XX months. to XX,XXX million of assets we monetize continue the now of feet over rights. acres $XXX far As acre we $XX identified Even plan to the rights,

are opportunities by leasing our investments. for water appreciation for over or pumping either rights We our great significant the monetization fallowing rights acreage, water selling finding assets

monetization the go River opportunity Class water The River water has the from that the will Class seven A rights, is These of of rights. all by will Arizona X and forced rights associated their have Department we the to instructed X,XXX X water near-term down. derive that pay acres has a reduce the and Colorado in water states for to states those Yuma, that farmland from X Interior cuts to water senior like with intake their first be come way Class water. third Colorado rights,

value rights, sales to of Colorado would of we would transaction There acre water of expect but proposed $XXX what a this $XX,XXX in Class take great for could our advantage our fallowing and per this new in guarantee water provides is acre value, foot, to no of of comparable which $X,XXX urban water a plan Buckeye, assets. over $XX use. City an XXX equate of for entitled happening with A our X,XXX space Arizona is be which X achieve we to from Limoneira farming recent comparable receive million is to we example to which water divert XX%. acres, million the a There's program River

Medical Limoneira. real We over our to proceeds Harvest Harvest of million timeline and projection our project updated Pavilion the to by the increased the December we at include the our that for we assets, XX% across addition these announced Harvest development this estate development at $XXX project In and have cash to both highway. end

are first received to to expand We approved fiscal quarter up we years. of and XXXX units. full proceeds City in in fourth able to is seven XXX and The million the year additional of announce fiscal project negotiations generate expect this X,XXX will million with later the to develop X,XXX currently We year. the $X Santa the units units we residential to over the of $XXX believe Paula that be

the Finally, million XXXX. on of fourth in to Pavilion Harvest we quarter forward of sales Medical at look transacting land the $X

the now model have clear shareholder strong that can focus assets business best expect on flow So very next and to enhance months, transition XX a balance a what an the you asset-light to XX path and for Over stronger we is and see to to to of cash use earnings? our EBITDA, continued sheet next our Limoneira value.

rights lands, management our order long-term marketing distributing water and with citrus Board team packing, enhance in agricultural shareholder estate to continue expertise portfolio properties of leverage to best how value. combined in valuable our Our and to and will real evaluate

our and beyond avocados to One and production the forward warehousing avocado World supply chain our in Citrus be our a increased As adding planning investments will as forward packing capital expanding to value potentially capacity Board also can product we investment production distribution, through in our of and areas for offerings. to could more decisions, different of produce returns. will that consistent reinvest addition more areas where allocation reliable upcoming potentially review of strategic Potential longer term, in session Directors and complement

And with call now to I'll the over Mark. turn that,

Mark Palamountain

Thank afternoon, Harold, you, good and everyone.

As a nature on to quarters, and quarterly first reminder, to and business annual are while business. Historically, seasonally it due our of quarters our an seasonal view our is softer third second quarters best the fourth the are basis stronger. the not

to fiscal million million to operations revenue XXXX, quarter $XX.X quarter revenue year was million in the XXXX. the total of last $X.X revenue the net year compared $XX.X revenue was previous For of year. to first quarter year. net compared Other first of the $X.X million first quarter total million $XX.X in fiscal of million $XX.X the first compared was fiscal Agribusiness in

carton the fiscal to XXXX. Agribusiness of were first million quarter revenue carton XXXX first sold X,XXX,XXX $XX.X at lemons cartons quarter of period $XX.X an approximately year of at the of same includes similar compared to year average sales, the fiscal fresh year cartons $XX.XX a Approximately per per for price fresh during sold in XXXX. fiscal $XX.XX price X,XXX,XXX year XXXX first during lemon quarter during of million fiscal the average

X,XXX,XXX first lemons from were the growers. XX% and cartons quarters of XXXX procured year the and packed X,XXX,XXX fresh fiscal of Of XX%, respectively, outside and XXXX, during respectively, U.S. sold

the an Citrus As grower part model the expansion through partners. of to company's World of One is asset-light strategic of transitioning it plan,

the average the XXXX, quarter rainfall into heavy first quarter the avocado the XXXX. year first company of of $XXX,XXX year company quarters. to price the avocado quarter of to fiscal but no of this occurred initial Due in on quarter in $X.XX for recognized third approximately year recognized The from first delayed revenue quarter XXXX XXXX, pounds harvest the at avocado timing the XXX,XXX second and in was recoup fiscal pushed year revenue expects fiscal during first that pound. The the second of revenue fiscal per a

quarter XXXX of year sold of recognized the oranges the of company of revenue XX,XXX $XXX,XXX The cartons first million in fiscal $X.X fiscal year in compared Approximately first during were orange to quarter of year at $XX.XX price of average approximately $XX.XX quarter cartons an carton year sold quarter price first during average XXXX. XXXX XX,XXX carton per per at to the fiscal the compared fiscal a first XXXX.

and of fiscal quarter year other of $XX.X XXXX result million of the year. of was Northern $XX.X the and first XXXX the first quarter recognized January to million were of primarily compared compared The in Properties Total for fiscal $X.X in citrus $XX of Specialty decrease the first costs in quarter million year expenses the revenues million to $XXX,XXX of the from year crop the sale first the last was XXXX. fiscal gain quarter in XXXX.

are recorded and $X.X There charges of to plan During the remaining fully fiscal million settle or obligations fund $X.X the quarter first of assets. XXXX, company's contributions funding million. no made plan of and the benefit year settlement retirement company

In second quarter in of in $X.X fiscal be fiscal quarter 'XX the a patronage dividend first to million patronage $X.X year XXXX. a the of recorded million of of compared addition, will dividend recorded year

million year after $X.X Operating to in the income first applicable applicable first XXXX dividends Net the previous first the stock stock compared fiscal to the loss quarter first quarter common for of of of operating fiscal preferred $X.X of a was to $XX.X compared in income $XX.X million common year of fiscal to year. million million XXXX fiscal an quarter net XXXX. year quarter loss of was the for

the in of the diluted compared year loss share to fiscal fiscal net loss million of Adjusted net period first $X.X fiscal the year was year for diluted year Net of to per $X.X period share a EPS same loss for fiscal for $X.XX income XXXX of was for XXXX. first quarter diluted $X.XX of a of quarter per same XXXX. XXXX million compared the

A to per income is an loss earnings net attributable of loss year compared for diluted the adjusted to of loss net loss or to at share EPS share diluted adjusted reconciliation diluted quarter of fiscal net for Adjusted XXXX. first was release. $X.XX $X.XX end per the Company Limoneira our of net provided

to in Adjusted loss of release. adjusted our compared the to Limoneira period fiscal loss year is of quarter Company XXXX EBITDA $X.X a in of year at the attributable million A of same reconciliation net first a of to also EBITDA was the loss earnings to XXXX. million of fiscal $X.X income provided end

the of liquidity. now to debt, to used the AgWest until X, January On line fixed Northern of Long-term was which were and fiscal debt of million. Turning balance resulted sold The in to XXXX, credit, all our our at XX, million pay year which XXXX compared we sheet $XX.X as January million is Credit million domestic of Properties $XX.X total July net $XX non-revolving $XXX.X of down XXXX. X.XX% our at end Farm XX, proceeds proceeds XXXX. except

in expect Also, of less a $XX $XX on quarter at levels resulted end. hand and million non-strategic and remaining improving Debt to in EBITDA we million for with balance of of assets debt cash XX, our have position sale have net their than million minus $XX.X a January result on no sheet. cash combined XXXX opportunity of the will as position debt monetization

like growth outlook to I'd to our term fiscal pipeline. Harold to longer the back XXXX Now, and call year discuss turn

Harold Edwards

is down from production to XXXX continue reports in to XX% fiscal year XX% lemons industry-wide expected Nature. suggest Crop for to be Mother

the our year in planned increase expecting fiscal partner of we our to volume due to and market increase However, grower are fruit, expansion share XXXX.

in the year is year for X.X million volume to year sales cartons This XXXX. X lemons XXXX. cartons and up fiscal total fiscal of be in from fiscal expect to million XXXX X.X million in X.X range to continue cartons cartons million We

the expect patronage fiscal primary to Farm AgWest, For from we year of formerly XXXX, in during the XXXX. lead beginning fiscal lender quarter second but the prices we pressure dividend XXXX, fiscal experience West, industry-wide half Credit second a quarter of our believe year million. $X.X lower second to of Also, continued will received of pricing year the higher production

in of We typically year XXXX million was while X avocado range for million expect that important volumes pounds to XXXX be fiscal adverse X avocado plant due crop continue year-over-year the with This, It's the year pounds. revenue, to alternate note California years year the decline. is record production to physiology. to and fiscal to of to low a weather experiences contributing for along high conditions,

that will our experienced a knocked September fruit trees crop. event unusually early a wind XXXX We of in high November and temperatures have impact negative avocado on our in off and

from the million and with Builders year years, expect seven million In fourth addition, the fiscal Limoneira of and continue of spread to II already at previous the estimate to II million Lewis in compared the received $XX Harvest receive out $X $XXX Community Area we East of fiscal to quarter proceeds Limoneira of over addition XXXX.

projections Area medical the home rate flow cash of The approximately interest the our cash were follows. Our number reduced starts. to months to of were new the higher out XX include II projections as flow be and pushed a updated which last portion development is due campus breakdown to quarter in expected environment, current the East

million. expected Fiscal to to of fiscal year generate to generate to is $XX to XXXX $XX to million XXXX XXXX generate million. is expected expected is XXXX Fiscal Fiscal XXXX Fiscal expected to is expected generate generate is year Fiscal $X year $XX Fiscal $X generated and million. $XX million year year Limoneira. year $X is XXXX XXXX million. cash expected million. year generate

stated, assets identified of non-strategic million $XXX as we lastly, have for And sale. previously

announce past the in six the remaining to progress of made sale our months, million with XX against and plan far months. have next We executing the million thus to XX expect of in $XXX the great $XX sale the

your open I'd now Operator? to that, to questions. the up And call like with

Operator

Certainly.

now Instructions]. will question-and-answer begin the session. We [Operator

The Eric comes first Research Seaport Larson Please question ahead. Partners. from from go

Eric Larson

are today? Hi, guys. doing How you

Harold Edwards

Hi, Eric.

Mark Palamountain

Eric. Hi,

Eric Larson

know So to question, my the I'd this. think first and answer I

the rights is to would been big part Is are that true figure any sale sort on with the of is it or or water of sales, to way price? So water as have out asset try going there And your not? valuables rights I'm the assuming. those split what

Harold Edwards

price rights. was part the water and access Properties, the for to due received Northern the water that of reliable of Eric, compelling So we

and But rights ranges of feet. a number water the Northern the There So down of the in each XX,XXX with feet with rights. water on assets value based of the Properties, various those to water acre sustainability varying properties reliability assets go and XX,XXX land of those did different acre the to with the about of those that sources. were sales. now prior we is divestiture number of had And associated

feet of with those acre X,XXX about So water properties. went

Mark Palamountain

further And Eric, just detail.

over rights above XX% left, of and prior adjudicated equate which have far we Paula So best and the which here water the value. to water are that basin the Santa Yuma,

So moving still water and forward in shape great there. with

Eric Larson

you. Thank clarification. good Okay. That's

lemon So was question Obviously, this business. next is soft quarter. just the it again

per $XX carton. under You're

around delayed curious going the to to outlook is continuing seems the look the Harold, breakeven flavor, tighten What a you gradual rest that think pricing kind price Give as really to up? about improving just year, be? but make at little need getting cadence more of it to $XX even the you us is to money. into be of how and and really how some supply kind situation I of to I'm of [indiscernible] when start does be

Harold Edwards

great a that's So question.

reality throughout but the to be a the oversupplied hemisphere. with lemon of market by from domestically, also imported fruit plantings exacerbated ready of dealing southern young lot and lot an Arizona keep of a California we So

California those year what the -- the growing fascinating to each was is of each the in found of timeframes his of all to costs of And when actually here really are really economics related in of of weighted as about a each profitability each the together go Arizona. of analysis we and them completed and and lemons Mark interesting achieved then And it districts districts market. interesting. what here's what the of of so of And Mark sort the a team those the and average price

lemons, cost starts for driven cost year And because equates generating house to was compromises the to do place desert. And the and Arizona to the which get lower what in found the we of in higher because in all the not yields. the us tough was that grow way to So you from carton, transportation amount other packing cost high our really structure it's it of that yields per you're there fruit Santa the places, Paula. a the

of So you that that together a really part that was really were we margin put the achieving. negative and

XXX program. in where takes of equation. is now of almost on going by we Arizona X,XXX the that going coupon water which we that the a being the replaced out of what's -- of And received story what's Arizona acres, XX% So of on is followed water it's cost for now of a more farming fallowing half

So operation desert now has the overnight become profitable.

costs Now productivity, we go North to so the in actually Valley, San other of costs for with Asian But applications related related was to that associated up Citrus also yields. pests higher the farming the the structure. were cost that similar a the and high Joaquin situation, the agricultural necessary higher because Psyllid, into some transportation of

been income. keep that packinghouse. And supply divested management So chain now by we now and services been that still has yet, replaced through our that's farm all coming

but also where of come these our spring And typically time the we that summer. get the at coast driven time late which pretty of the production early cost the the year of the really you actually the Now production it's seasonally on total yields, higher year. is out And consumptions good. And the a highest by that XX% because it's pricing structure what is know, in down much down profitability higher are coast, here in lower the lemons the you of takes place. high as in when to California and come

improve driven receiving is prices you're put to seeing you it pervasive just by start of our going oversupply to So when these with you'll we're going the to that's start even together, I see of lemons, that all the restructuring that challenging you're of the business. now margins think because see what

Eric Larson

makes sense. of a lot That insight. it. Got That's good

the So you are that issue just whole when be laid of you with imports can the this lemons, on really thing, or of domestic in in kind an sort seeing solved out? also that is factor a increase analytic you

Harold Edwards

that I kind makes southern also is level, greatest that to opportunity logistics at becomes at because moat ship challenge the pricing this price shippers this because the it market a the you the greatest think here Well, to get of is uneconomic of creates it that costs for hemisphere when around get down it prohibitive. their into the market

enjoy fruit economics. up. as drive think don't that see really think above a to now, I So of pricing we to carton our it any year because right, domestic a just forward, right import want the an those half look threat reality, competitive and make can price be it until But We we not yet. takes the there there, think I catalysts the to I takes we're -- overall $XX second

to we'll So is a summer early the late get higher crop have -- that where we just the see domestically, it are the because get summer. spring, summer. late pricing we smaller to in see we'll But spring, early optimistic when we

Eric Larson

Got it.

much stuff Okay. of in still to you prohibitive you miss is days. for of because at how -- with East such complain to guys -- you about to just looking it. you think when that realize you parts days here going how inches are you there's the be it you you in mountains moisture the be right are the weather But and Final rain few harvest, now question, think don't rain next eight conditions don't have it getting are in I hammered six few just to to some you again, going of next the -- in or

are that? you at looking how all So

Harold Edwards

Yes.

and week. of it's very all great anticipate an we across So structures. picking in We this subject delayed deck on that inventory meeting good We have hands news I is for all the grade another better that question. And the good morning. had on guess do part size we -- being a this had

pointing Central California. lot you're As to there's of rain a coming Northern and out,

coast terms with District season, continuing the just here fine right on is we We with we now San the need the fruit. in get of But are ready X. on the being our the Right now kind up Valley. if to go Joaquin to midway anticipate in of ready go harvest crews through crop in

And a think so normal District X kind this in that'll smoothly the weather out into we even rain, then with transition of a this finish way, coast. and and onto

as blooming here you because remember, there, X are crop year trees is I think the always Eric, the District round. might

access because weren't amounts have the And and can cooking do our we're this harvest, with where we even make supply good all weather. where situation So making Inventories that to fruit. balanced into right year we along and get to we of able that lemons keep sure chains and sure are inventories big size so that are good. that that had XXXX unlike over got to grade we happen, trying by does not that the this

Eric Larson

I'll get back Thanks. All queue. right. in

Operator

Please The Sharma from Raj Riley. ahead. from next question B. comes go

Raj Sharma

had -- sort also, a kind pricing well. up taking half pickup Can that? significant following I question. you that expect is with in the the on cartons mentioned lemons, come about you you improved pricing. production for Where you talk from? Thank just my increase of talk going a external can was to to What a this Hi. And of there pricing second a did you just I we you going know as improve on thought you that growers be going and event. lemons? to the expect why said was were about increased

Harold Edwards

own in we is wish answer our crops, the valley, we what for we serviced the tree in the our three I on and production own harvest But in our the know of million additional coast. the cartons all kind could we fruit question. our production. XXXX. districts of combination an a directly of season have with that great at were But with crystal across new are That's in as ample that Hi, ball. on we par look that production harvest Raj. we're remainder with grower of our partners of I also in up And X my and that behind the recruiting successful

us though so tree able districts, actually brought we'll belief Nature recruiting fruit. even the be that our grow great a crop And enough and to lower us XX% across give Mother of have access each to about of

we're year-on-year. guidance And the hanging which growth still sort to million our some year, so pretty X.X demonstrate to X.X for million would of on cartons of good

cartons. last finished year we think X.X million with I

get fruit is to much the changing is it not grade size this at of disruption or we've weather so and the And in there causing structure. and go enough got that point time terms

that we'll packinghouse into through get be it it get to the optimistic we're it and market. able and So put the

Mark Palamountain

follow asked all April, balance typically to supply-demand it up from pricing, the that in to Eric early And late comes Argentina from Yes. start that down imports as earlier, May. on

$X So And perspective. high if below current Mother isn't historically it the them right then to looked usually price the that's But enough $XX rest lift just Nature transportation costs budgeting aren't break about now. there, from right at a of $X does a or thing. we've for even, the get if we'll which from is her pricing, how

Raj Sharma

talk a of onwards? this the of Thank production, QX be do a please? great. side? most you. on production much Can to you avocado lower Are recover recovery last about How to year. That's then happening lot that able you it, you it? in of And clearly see going year on than What's the

Harold Edwards

Yes.

really rain So is for avocados. the the actually helpful

be week. the high be opportunities avocado marketplace. think that we now $X.XX volume this the the that optimism I that's little driven see really at where in directionally point should us pricing over range last numbers. of we gives kind harvest of marketplace. now sort The to targeted we it by in in will saw were are of the harvest. an XXs And was getting a the in news uptick Great hoping we So

to find seems of we're coming that end and there's the the be at to. million market range this pound on that us we we pretty confident improving million guided So the And point. upper X to to X

it'll we avocado be it's little day. will when number driven for Fingers harvesting. that is if pin market start guidance we every but us by our the that think pricing. But And in favorable too does, a the more difficult market overall I market it and better, crossed down. comes watch just And it moves, to So intact.

would think X QX say fruit I of pounds XX% how if million out, to in play had I'd in QX. XX% the and I flow guess

Raj Sharma

if improvements, it. brokering that you a see profitability, where do in terms on And profitability to see Is and I then sort of from EBITDA of improvements Got shipping? just this improvements you sort EBITDA of you margins philosophically year? kind greater and can about of move talk coming can

Harold Edwards

a so a niches bunch that. Yes, question of to great and

Raj Sharma

we expect? much an of How can EBITDA

Harold Edwards

that as all X the alluded basically the fall this circles the targeted going areas The this XX million was and to over So which about from million said, that's X year then around X prior to ramp side cartons, the million million are, to, to just X.X starting business, so $X.XX cartons through comes operating agency and we've brokerage years. then transition from transaction And the a you be accretiveness, then this this $X.XX we'll the EPS. and see to accretiveness recruiting, over is XX perspective seasons. new both of benefit to as that year, effect next million X.X in see we year months, which will five the an period about into profit. also to carton about EBITDA And new from trying which

highlight, So to subject tried lemon we've as to we're pricing.

control. relatively Our under costs have been

year year-over-year quarter versus this was unit. down prior per costs packing Our

So efficiencies started we from really in play. all to have that cost of to place put the measures come the

still million of $XX targeting the five years. in So next plus ourselves EBITDA see we

Raj Sharma

or that would from sales rights next the give color the in just just mentioned happen that? years. land, the generally that additional me, it. $XX you question you in on that And year million water last two Is any us areas? Got sales, Can

Harold Edwards

Yes.

and assets, if So then got the I lemons primarily, vineyard Windfall right, the specific is additional southern the is estates. question which Chilean XX farming, our two million, our two ranches, hemisphere

million, those book close so And to placeholders are value. XX at pretty

I the the buyer opportunity the in So right upside will think opportunity circumstances, an for there. number. depending appropriate we and that felt that there But was be right water on and

Raj Sharma

for Thank you. you I'll good take my offline. this questions answering luck. and thank Well, Great.

Harold Edwards

Raj. Thank you,

Mark Palamountain

you, Thank Raj.

Operator

comes question The Klieve go Markets. Ben Please from Lake Street from ahead. next Capital

Ben Klieve

questions. my taking for Thanks

for me. couple a Just

and First your side, of of sure kind in here. Harold, strategy timing first the February, all, of earlier The maybe avocado want at delays quarter. weather suggested understand I the in conditions. comments kind of on through of least of kind because I the the to pricing And of caused February, make harvesting kind you'd that delayed intentionally harvest

that kind far but accurate have second the of you've strategically? all, is chosen that avocados first quarter, harvested so you in not to could of So

Harold Edwards

that week. harvested. exactly soft. now. they've shape our layer have rain, There's pretty fruit but been the could improve that's harvest to harvestable benefits beginning right I know have to -- if now, fruit the the you're on ourselves we next starting markets, start they're markets following of And you faster, which actually when Yes, find but good sizing the been don't We right. is pretty the And just in is

Ben Klieve

I grind, I've Okay, the the that market think reports and been that great. following I Eric That's also weather been helpful. Yes, has. have same and watching

just the here with faster of to developed in this high $XX range? gain take a able been And you are on these to market is, prices a about get ability my this you and share? $XX, how your question level kind you good pretty are But farmers are wondering looks see impressive range, you've can $XX, lemon concerned if and that. so like correlation prices got that's other $XX to so share And you're dreary in comment relationships that. navigating I've that year if it than in then I'm down between far, about guys When

Harold Edwards

supply first. is So gaining part share of gaining

and So of high really rates, having our with competitive with grower team, that, to lot then services back fresh utilization we're our success going growers. very a our returns very

result, into reliable retail supply, service be levels really at and food it the supply. access allows huge progress And made much go to then and new us then So our as ability that supply. marketplace with to with of we in a more competitive

growth And those things combination share. up of and pick is I to driving two the so allowing what's us think our

business driven actual retail. marketplace consumer XX-XX say XX% in perspective really and sort when a COVID and of we've returned food that together, that the service by of since sort represented of change now, service the started food probably all much a our we recall kind may the was life. changed is XX% as always But about demand hasn't first of a that retail talking suggested XX% market You back placeholder XX%. was opportunity is There structural I'd to normal we from

And at so pickups biggest retail been our in level. have gains the

that's finding lemons so to battlefield And we're And better stickered you retail as market, go local the really And chance really on now. in out those because and for much honing of of have where supermarkets now a you'll this big Limoneira right accounts. we're us new in focusing. new your approach

Ben Klieve

Got it, very helpful.

get Okay. Thanks questions. back for my taking in I'll line.

Harold Edwards

Ben. Thanks,

Mark Palamountain

Ben. Thanks,

Operator

[Operator Please Vincent from Instructions]. go comes The Anderson next from question Stifel. ahead.

Vincent Anderson

Good Thanks. afternoon.

Harold Edwards

Vince. Hi,

Vincent Anderson

the we to But are through When my how head regions recent from as understand pressure at what coming can just poor definitely I wrap price production, the just year I growing expectations still we've balance this have look trying move where many is another overseas yet seen. around year. of I'm of your

then. two-parter a guess I So

China remember drinking saw supply U.S. start Asian pressure volume looking, Because is being from the of is much by last I side, causing the that? lemon On kind everyone earth early of caused side, on since apparently year. unseasonable water? particularly Mexican how this then the maybe this in how to exports the demand been on have this them the told imports and can't time what I And into

Harold Edwards

Yes.

lot it's And across young districts. analysis, that pickup, really continue to that demand the the There just driving the plantings into the higher but proud southern the what's fruit hope of caused of suppliers, that's of it's when what's of slowly oversupply fresh now was your sort and of market that's you each layer fresh then pickup. supply remember Argentina that's massive And plantings entire we moving situation. that our to the is first year, which So is, part malaise the more really amount domestically. to than ability awful hemisphere the rates softer out our of for back and the the exacerbated last growers. returns what's pricing other the move some we an of What's and were of in utilization really

competitor primary really underperformed. Our

we're And all the kind not year to gloves off right, so again. took this let going and happen they've said, of that

a you to called CALGA, of what's looked lot which a price -- of California/Arizona the to more all And hang so across of shippers. consortium of chasing to all down a member there's Growers try so on Lemon And the if share. is the Association, we're

Typically it at of now. can think the Limoneira’s list the about right pricing domestic we supply to XX% right the And of I of is as represents production. try go the doing almost we top as as remain lemon we that. disciplined hard what U.S. moving, and though to problem marketplace. how get and imagine use And happens will you a get when exacerbating is typically coolers move coolers that's pricing fruit. the competition in fruit when has can what's full, time price this works, full

Vincent Anderson

market of there it I potential have in beyond your a to were kind a investment capital I'm makes especially it can looking Okay, you sense the which just then if home. and deployment Europe like some just might it there's your a another return that way market that's of be an sounded new assets American packing not deleveraging, like become in if for as speculate perspective, South on brokering from wondering very citrus valve or your make that's if that high fruit, helpful. maybe a And in in mind? really any for

Harold Edwards

logistics, The The and competitively. because U.S. observation. a it Argentina biggest into equation it's think tough. a that been And pretty the of would thinking fruit markets actually have way European its of Argentina, be is that been lot winner really because can about. astute studying something Well, in we've fruit, find that's I

doesn't well. help as exchange Foreign that

that's So opportunity point. us really at less this an for of

chains but a help drive supply storage we see capabilities strategic and advantage through out will invest this advantage to really that the we we supply planning still is upcoming in part our leaseback Oxnard pretty our of storage sale we actually Board the of of think on. to take our but thing we Lemon, chain depend I us remember business. take initial other automation -- remember in see cost session, improvement to and when have, of that that capacity to enhanced to and through we interesting opportunities And the the that sale on did sold with

what significant. we've in be three within alternative to going But investing in results we're Paula So running where -- of going the years, got storage. in And the increased calculators out would pretty do. a here are to find the Santa and of are numbers to we're need sort we're capabilities position storage

recently as on And capital here so great storage Paula, Santa to invest a to invested think in updated complement our be return a packinghouse. in there'd we

So packing -- And look sort in of towards investments increased something also we've capacity talked in this like that. Chile. before, and about

Vincent Anderson

Okay. it. All very right, helpful. appreciate I

Operator

I Instructions]. question-and-answer Please to would ahead. session. back conference go Harold Edwards to the This remarks. concludes over [Operator closing like turn for the any

Harold Edwards

in Limoneira. a Have Thank great you all and your interest your for questions day.

Operator

This today's concludes call. conference

Have day. participating. for you Thank lines. your disconnect pleasant may You a

Limoneira (LMNR) 10 Mar 232023 Q1 Earnings call transcript