- First Quarter of Fiscal Year 2013 Agribusiness Revenue Increased
77% Versus First Quarter of Last Year -
- First Quarter of Fiscal Year 2013 Lemon Sales Increased 80%
Compared to Same Period Last Year -
- Company Completed Public Offering of Common Stock with Gross
Proceeds of $38.3 Million -
- Company Received Final Required Approval to Begin Development of
East Area 1 -
- Company Reiterates Fiscal Year 2013 Lemon and Avocado Volume Growth
Guidance -
SANTA PAULA, Calif.--(BUSINESS WIRE)--
Limoneira Company (NASDAQ: LMNR), a leading agribusiness with prime
agricultural land and operations, real estate and water rights in
California, today reported financial results for the first quarter ended
January 31, 2013.
Fiscal Year 2013 First Quarter Results
For the first quarter of fiscal year 2013, revenue was $17.4 million,
compared to revenue of $10.2 million in the first quarter of the
previous fiscal year. Agribusiness revenue increased 77% to $16.3
million, compared to $9.2 million in the first quarter last year. Rental
operations revenue was $1.0 million in the first quarter of fiscal year
2013, essentially flat compared to the first quarter last year. Real
estate development revenue was $48,000, compared to $44,000 in the first
quarter last year.
First quarter fiscal year 2013 agribusiness revenue includes $14.0
million in lemon sales, compared to $7.8 million of lemon sales during
the same period of fiscal year 2012, reflecting a larger number of
cartons of fresh lemons sold, partially offset by lower average price
per carton. The Company also experienced higher sales of lemon
by-products compared to the same period last year. As anticipated, due
to the typical seasonality of the avocado crop, the Company did not
record significant avocado sales during the first quarter of fiscal year
2013. In the first quarter of fiscal year 2012, the Company generated
$124,000 of revenue from avocados. The Company recognized $1.4 million
of orange revenue in the first quarter of fiscal year 2013 compared to
$500,000 of orange revenue in the same period of fiscal year 2012. The
increase is primarily due to production from Sheldon Ranch. Specialty
citrus and other crop revenues were $883,000 in the first quarter of
fiscal year 2013, which was $72,000 more than the first quarter of
fiscal year 2012.
Costs and expenses for the first quarter of fiscal year 2013 were $22.7
million, compared to $15.0 million in the first quarter of last fiscal
year. The year-over-year increase in operating expenses primarily
reflects increased agribusiness costs associated with the higher sales
for this segment. Packing costs increased, primarily attributable to a
higher volume of fresh lemons packed and sold compared to the same
period of fiscal year 2012. On a per carton basis, packing costs were
$5.60 for the first quarter of fiscal 2013 compared to $6.34 compared to
the same period of fiscal year 2012, as costs were leveraged across a
larger volume of lemons packed and sold. Third-party grower costs
increased in the first quarter of fiscal year 2013 compared to the same
quarter of last year, due to an increase in lemons procured from
third-party growers and in particular from Associated Citrus Packers,
which began in August 2012.
Operating loss for the fiscal year 2013 first quarter was $5.3 million,
compared to an operating loss of $4.7 million in the first quarter of
the previous fiscal year. The increase in loss is primarily due to an
larger operating loss of $101,000 in the agribusiness segment, resulting
from lower lemon prices in the first quarter of fiscal year 2013
compared the first quarter of the prior year and typical seasonality in
timing of the avocado harvest, which resulted in a lower avocado profits
in the first quarter of fiscal year 2013 versus the same period last
year. In addition, selling general and administrative expenses were
higher in the amount of $494,000 in the first quarter of fiscal year
2013 compared to the same period of last year related to increased
salaries, benefits and incentive compensation, greater selling expenses
due to increased lemon sales volume and consulting expenses primarily
related to the Company's growth initiatives.
EBITDA was ($4.4) million in the first quarter of fiscal year 2013,
compared to ($3.9) million in the same period of fiscal year 2012. A
reconciliation of EBITDA to the GAAP measure net income is provided at
the end of this release.
Primarily as a result of a larger amount of capitalized interest on real
estate development projects during the first quarter of fiscal year
2013, interest expense was $124,000 compared to $175,000 in the same
period of fiscal year 2012. Non-cash fair value adjustments on the
Company's interest rate swap resulted in income of $221,000 in the first
quarter of fiscal year 2013, compared to $159,000 in the same period of
the prior year.
Net loss applicable to common stock, after preferred dividends, for the
first quarter of fiscal year 2013 was $3.2 million, or ($0.28) per
share. This compares to net loss applicable to common stock, after
preferred dividends, in the first quarter of fiscal year 2012 of $2.9
million, or ($0.26) per share.
Management Comments
Harold Edwards, President and Chief Executive Officer, stated, "Our
first quarter results represent a solid start to fiscal 2013. While our
results reflect the expected soft seasonality of business in the first
quarter, we posted a strong increase in our agribusiness revenue, driven
by higher lemon and other citrus sales. We continue to expect to achieve
our previously stated guidance of 25% year-over-year increase in cartons
of lemons sold and a 50% year-over-year increase in pounds of avocados
sold for the full year fiscal 2013.
"Following the annexation of East Area 1 into Santa Paula last month, we
are now able to proceed with our master planned community project. We
have already begun tract mapping development, and we are on-plan to
break ground in 2014. We are extremely excited to begin this new phase
for Limoneira's real estate development. As the project progresses,
Limoneira is well positioned to benefit from the expected additional
cash flow associated with the development."
Mr. Edwards continued, "We recently completed a public offering of
common stock, in which we raised total gross proceeds of approximately
$38.3 million. This offering provides us with additional financial
flexibility to make strategic investments and acquisitions to grow our
business and with the additional shares issued, we expect this public
offering will improve the liquidity of our stock. Thus far, we have used
the proceeds to pay down a portion of our long-term debt in order to
improve our balance sheet and we are evaluating investments into our
real development projects and potential agribusiness acquisition
opportunities."
Balance Sheet and Liquidity
Subsequent to the end of the first quarter of fiscal year 2013, during
February 2013, the Company completed a public offering of 2,070,000
shares of its common stock at a public offering price of $18.50 per
share, for total gross proceeds of approximately $38.3 million. The
Company intends to use the net proceeds from this offering for general
corporate purposes, which includes repayment of long term debt,
investments in real estate development and acquisitions of agriculture
property. During February 2013, the Company repaid approximately $36.0
million of long-term debt with the net offering proceeds.
Real Estate Development
During the first quarter of fiscal year 2013, the Company continued to
execute its real estate development strategy by capitalizing development
costs of $1.3 million. In same period of the prior year, the Company
capitalized development costs of $1.2 million.
Recent Business Highlights
The Company continues to benefit from the success of its direct lemon
sales and marketing strategy. In the first quarter of fiscal year 2013,
lemon sales were comprised of approximately 56% to U.S. and Canada-based
customers and 44% to domestic exporters.
Alex Teague, Senior Vice President, stated, "We continue to benefit from
our direct lemon marketing and sales strategy. We now have over 100
different lemon customers, underscoring the success of our sales team.
In the first quarter of fiscal 2013, we sold approximately 422,000 more
fresh lemon cartons than in the same period last fiscal year, and we are
looking forward to continued growth throughout the year as we benefit
from the additional agricultural acreage we acquired and leased in
fiscal year 2012."
In February 2013, East Area 1 was formally annexed into Santa Paula. The
annexation was the final required step to enable Limoneira to
immediately proceed with East Area 1, a master planned community
project. When completed, East Area 1 is expected to consist of 501 acres
of commercial and residential properties, including 1,500 residential
units, 210,000 square feet of commercial space, and 150,000 square feet
of light industrial space. Also part of the planned community project is
East Gateway Project (also known as East Area 2), which is expected to
consist of 350,000 square feet of new commercial property.
Fiscal 2013 Outlook
The Company is reiterating its previously announced outlook for fiscal
year 2013. For the fiscal year ending October 31, 2013, the Company
expects to sell between 3.0 million to 3.2 million cartons of lemons,
representing approximately 25% increase over fiscal year 2012 and
expects to sell between 17 million to 19 million pounds of avocados,
representing approximately 50% increase compared to fiscal year 2012.
Lemon and avocado prices are expected to be lower in fiscal year 2013
than 2012 due to higher industry production.
In addition, the Company expects the Sheldon Ranch leases to be
profitable in fiscal 2013 compared to a loss of $735,000 in fiscal year
2012.
The Company began 2013 with approximately 800 additional revenue
generating agricultural acres, representing a 12% increase compared to
the beginning of fiscal 2012.
Conference Call Information
The Company will host a conference call and audio webcast March 12,
2013, at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) to discuss its
financial results. To access the conference call, participants in the
U.S. should dial (800) 390-5202, and international participants should
dial (719) 325-2257. Participants are encouraged to dial in to the
conference call ten minutes prior to the scheduled start time. The call
will also be broadcast live over the Internet and accessible through the
Investor Relations section of the Company's website at www.limoneira.com. Visitors
to the website should select the "Investor" link to access the
webcast. The webcast will be archived and accessible on the same website
for 30 days following the call. A telephone replay will be available
through March 26, 2013, by calling (877) 870-5176 from the U.S. or (858)
384-5517 from international locations to access the playback; passcode
is 3371964.
About Limoneira Company
Limoneira Company, a 120-year-old international agribusiness
headquartered in Santa Paula, California, has grown to become one of the
premier integrated agribusinesses in the world. Limoneira (pronounced lē
mon΄âra) is a dedicated sustainability company with approximately 8,200
acres of rich agricultural lands, real estate properties and water
rights in California. The Company is a leading producer of lemons,
avocados, oranges, specialty citrus and other crops that are enjoyed
throughout the world. For more about Limoneira Company, visit www.limoneira.com.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. These
forward-looking statements are based on Limoneira's current expectations
about future events and can be identified by terms such as "expect,"
"may," "anticipate," "intend," "should be," "will be," "is likely to,"
"strive to," and similar expressions referring to future periods.
Limoneira believes the expectations reflected in the forward-looking
statements are reasonable but cannot guarantee future results, level of
activity, performance or achievements. Actual results may differ
materially from those expressed or implied in the forward-looking
statements. Therefore, Limoneira cautions you against relying on
any of these forward-looking statements. Factors which may cause future
outcomes to differ materially from those foreseen in forward-looking
statements include, but are not limited to: changes in laws,
regulations, rules, quotas, tariffs and import laws; weather conditions
that affect production, transportation, storage, import and export of
fresh product; increased pressure from crop disease, insects and other
pests; disruption of water supplies or changes in water allocations;
pricing and supply of raw materials and products; market responses to
industry volume pressures; pricing and supply of energy; changes in
interest and currency exchange rates; availability of financing for land
development activities; political changes and economic crises;
international conflict; acts of terrorism; labor disruptions, strikes or
work stoppages; loss of important intellectual property rights;
inability to pay debt obligations; inability to engage in certain
transactions due to restrictive covenants in debt instruments;
government restrictions on land use; and market and pricing risks due to
concentrated ownership of stock. Other risks and uncertainties
include those that are described in Limoneira's SEC filings, which are
available on the SEC's website at http://www.sec.gov.
Limoneira undertakes no obligation to subsequently update or revise
the forward-looking statements made in this press release, except as
required by law.
|
|
|
Non-GAAP Financial Measures
|
|
|
|
Due to significant depreciable assets associated with the nature
of the Company's operations and interest costs associated with its
capital structure, management believes that earnings before
interest, income taxes, depreciation and amortization ("EBITDA")
and Adjusted EBITDA, which excludes impairments on real estate
development assets when applicable, is an important measure to
evaluate the Company's results of operations between periods on a
more comparable basis. Such measurements are not prepared in
accordance with U.S. generally accepted accounting principles
("GAAP"), and should not be construed as an alternative to
reported results determined in accordance with GAAP. The non-GAAP
information provided is unique to the Company and may not be
consistent with methodologies used by other companies. Unaudited
EBITDA is summarized and reconciled to net income, which
management considers to be the most directly comparable financial
measure calculated and presented in accordance with GAAP as
follows:
|
|
|
|
|
|
Three months ended January 31,
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
Net loss
|
|
$
|
(3,122,000
|
)
|
|
$
|
(2,809,000
|
)
|
|
Total interest income, net
|
|
|
(121,000
|
)
|
|
|
(9,000
|
)
|
|
Income tax benefit
|
|
|
(1,655,000
|
)
|
|
|
(1,580,000
|
)
|
|
Depreciation and amortization
|
|
|
542,000
|
|
|
|
520,000
|
|
|
EBITDA
|
|
$
|
(4,356,000
|
)
|
|
$
|
(3,878,000
|
)
|
|
|
|
Limoneira Company
|
|
Consolidated Balance Sheets (unaudited)
|
|
|
|
|
|
January 31,
|
|
October 31,
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
Assets
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash
|
|
$
|
24,000
|
|
|
$
|
11,000
|
|
|
Accounts receivable, net
|
|
|
7,557,000
|
|
|
|
4,252,000
|
|
|
Notes receivable — related parties
|
|
|
42,000
|
|
|
|
42,000
|
|
|
Cultural costs
|
|
|
1,445,000
|
|
|
|
2,254,000
|
|
|
Prepaid expenses and other current assets
|
|
|
2,641,000
|
|
|
|
2,116,000
|
|
|
Income taxes receivable
|
|
|
2,367,000
|
|
|
|
712,000
|
|
|
Total current assets
|
|
|
14,076,000
|
|
|
|
9,387,000
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
53,614,000
|
|
|
|
53,380,000
|
|
|
Real estate development
|
|
|
79,102,000
|
|
|
|
77,772,000
|
|
|
Equity in investments
|
|
|
9,044,000
|
|
|
|
8,947,000
|
|
|
Investment in Calavo Growers, Inc.
|
|
|
16,565,000
|
|
|
|
15,701,000
|
|
|
Notes receivable — related parties
|
|
|
16,000
|
|
|
|
16,000
|
|
|
Notes receivable
|
|
|
2,315,000
|
|
|
|
2,296,000
|
|
|
Other assets
|
|
|
5,412,000
|
|
|
|
5,123,000
|
|
|
Total assets
|
|
$
|
180,144,000
|
|
|
$
|
172,622,000
|
|
|
|
|
|
|
|
|
Liabilities and stockholders' equity
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable
|
|
$
|
4,208,000
|
|
|
$
|
3,670,000
|
|
|
Growers payable
|
|
|
5,446,000
|
|
|
|
2,085,000
|
|
|
Accrued liabilities
|
|
|
2,810,000
|
|
|
|
4,017,000
|
|
|
Fair value of derivative instrument
|
|
|
715,000
|
|
|
|
1,072,000
|
|
|
Current portion of long-term debt
|
|
|
767,000
|
|
|
|
760,000
|
|
|
Total current liabilities
|
|
|
13,946,000
|
|
|
|
11,604,000
|
|
|
Long-term liabilities:
|
|
|
|
|
|
Long-term debt, less current portion
|
|
|
96,236,000
|
|
|
|
88,875,000
|
|
|
Deferred income taxes
|
|
|
11,085,000
|
|
|
|
10,488,000
|
|
|
Other long-term liabilities
|
|
|
8,667,000
|
|
|
|
8,953,000
|
|
|
Total long-term liabilities
|
|
|
115,988,000
|
|
|
|
108,316,000
|
|
|
Commitments and contingencies
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
Series B Convertible Preferred Stock — $100.00 par value (50,000
shares authorized: 30,000 shares issued and outstanding at January
31, 2013 and October 31, 2012) (8.75% coupon rate)
|
|
|
3,000,000
|
|
|
|
3,000,000
|
|
|
Series A Junior Participating Preferred Stock — $.01 par value
(20,000 shares authorized: 0 issued or outstanding at January 31,
2013 and October 31, 2012)
|
|
|
-
|
|
|
|
-
|
|
|
Common Stock — $.01 par value (19,900,000 shares authorized:
11,237,085 and 11,203,180 shares issued and outstanding at January
31, 2013 and October 31, 2012, respectively)
|
|
|
112,000
|
|
|
|
112,000
|
|
|
Additional paid-in capital
|
|
|
35,929,000
|
|
|
|
35,714,000
|
|
|
Retained earnings
|
|
|
12,790,000
|
|
|
|
16,398,000
|
|
|
Accumulated other comprehensive loss
|
|
|
(1,621,000
|
)
|
|
|
(2,522,000
|
)
|
|
Total stockholders' equity
|
|
|
50,210,000
|
|
|
|
52,702,000
|
|
|
Total liabilities and stockholders' equity
|
|
$
|
180,144,000
|
|
|
$
|
172,622,000
|
|
|
|
|
Limoneira Company
|
|
Consolidated Statements of Operations
(unaudited)
|
|
|
|
|
|
Three months ended
|
|
|
|
January 31,
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
Revenues:
|
|
|
|
|
|
Agribusiness
|
|
$
|
16,298,000
|
|
|
$
|
9,202,000
|
|
|
Rental operations
|
|
|
1,036,000
|
|
|
|
991,000
|
|
|
Real estate development
|
|
|
48,000
|
|
|
|
44,000
|
|
|
Total revenues
|
|
|
17,382,000
|
|
|
|
10,237,000
|
|
|
Costs and expenses:
|
|
|
|
|
|
Agribusiness
|
|
|
18,587,000
|
|
|
|
11,390,000
|
|
|
Rental operations
|
|
|
619,000
|
|
|
|
568,000
|
|
|
Real estate development
|
|
|
243,000
|
|
|
|
248,000
|
|
|
Selling, general and administrative
|
|
|
3,265,000
|
|
|
|
2,771,000
|
|
|
Total costs and expenses
|
|
|
22,714,000
|
|
|
|
14,977,000
|
|
|
Operating loss
|
|
|
(5,332,000
|
)
|
|
|
(4,740,000
|
)
|
|
Other income (expense):
|
|
|
|
|
|
Interest expense
|
|
|
(124,000
|
)
|
|
|
(175,000
|
)
|
|
Interest income related to derivative instruments
|
|
|
221,000
|
|
|
|
159,000
|
|
|
Interest income
|
|
|
24,000
|
|
|
|
25,000
|
|
|
Other income, net
|
|
|
417,000
|
|
|
|
345,000
|
|
|
Total other income
|
|
|
538,000
|
|
|
|
354,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income tax benefit and equity in earnings (losses) of
investments
|
|
|
(4,794,000
|
)
|
|
|
(4,386,000
|
)
|
|
Income tax benefit
|
|
|
1,655,000
|
|
|
|
1,580,000
|
|
|
Equity in earnings (losses) of investments
|
|
|
17,000
|
|
|
|
(3,000
|
)
|
|
Net loss
|
|
|
(3,122,000
|
)
|
|
|
(2,809,000
|
)
|
|
Preferred dividends
|
|
|
(66,000
|
)
|
|
|
(66,000
|
)
|
|
Net loss applicable to common stock
|
|
$
|
(3,188,000
|
)
|
|
$
|
(2,875,000
|
)
|
|
|
|
|
|
|
|
Basic net loss per common share
|
|
$
|
(0.28
|
)
|
|
$
|
(0.26
|
)
|
|
|
|
|
|
|
|
Diluted net loss per common share
|
|
$
|
(0.28
|
)
|
|
$
|
(0.26
|
)
|
|
|
|
|
|
|
|
Dividends per common share
|
|
$
|
0.04
|
|
|
$
|
0.03
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding-basic
|
|
|
11,220,000
|
|
|
|
11,205,000
|
|
|
Weighted-average common shares outstanding-diluted
|
|
|
11,220,000
|
|
|
|
11,205,000
|
|
Investor Contact:
ICR
John Mills
Senior Managing
Director
310-954-1105
Source: Limoneira Company
News Provided by Acquire Media
