- First Quarter Revenue Increased 8% Versus Last Year -
- First Quarter Lemon Sales Increased 18% Versus Last Year -
- Company Reiterating Fiscal Year 2015 Outlook -
SANTA PAULA, Calif.--(BUSINESS WIRE)--
Limoneira Company (the "Company" or "Limoneira") (NASDAQ: LMNR), a
leading agribusiness with prime agricultural land and operations, real
estate and water rights in California and Arizona, today reported
financial results for the first quarter ended January 31, 2015.
Fiscal Year 2015 First Quarter Results
For the first quarter of fiscal year 2015, revenue was $28.0 million,
compared to revenue of $25.9 million in the first quarter of the
previous fiscal year. Agribusiness revenue was $26.9 million, compared
to $24.7 million in the first quarter last year, reflecting higher lemon
revenue partially offset by lower orange, and specialty citrus and other
crop revenue. Rental operations revenue was $1.1 million in the first
quarter of fiscal year 2015 and the first quarter of last year. Real
estate development revenue was $10,000 compared to $44,000 in the first
quarter last year.
Agribusiness revenue for the first quarter of fiscal year 2015 includes
$24.7 million in lemon sales, compared to $20.9 million of lemon sales
during the same period of fiscal year 2014, primarily reflecting a
higher average price per carton due to more favorable market conditions
and an increase in fresh lemon cartons sold 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 2015. The Company recognized $1.5 million
of orange revenue in the first quarter of fiscal year 2015, on lower
prices partially offset by higher sales volume, compared to $1.9 million
of orange revenue in the same period of fiscal year 2014. Specialty
citrus and other crop revenues were $0.7 million in the first quarter of
fiscal year 2015, on lower prices and sales volume, compared to $1.9
million in the first quarter of fiscal year 2014.
Costs and expenses for the first quarter of fiscal year 2015 were $30.5
million, compared to $28.1 million in the first quarter of last fiscal
year. The year-over-year increase in operating expenses primarily
reflects additional agribusiness costs mainly associated with higher
packing costs related to increased lemon sales volume and the Company's
Yuma, Arizona packing operations, which was acquired in June 2014. In
addition, third-party grower costs were higher in the first quarter of
fiscal year 2015 compared to the same period of fiscal year 2014 related
to a larger volume of fruit procured from third party growers at higher
prices.
Operating loss for the first quarter of fiscal year 2015 was $2.5
million, compared to $2.2 million in the first quarter of the previous
fiscal year.
EBITDA was ($1.2) million in the first quarter of fiscal year 2015,
compared to ($1.1) million in the same period of fiscal year 2014. A
reconciliation of EBITDA to the GAAP measure net income is provided at
the end of this release.
Net loss applicable to common stock, after preferred dividends, for the
first quarter of fiscal year 2015 was $1.6 million, compared to $1.3
million in the first quarter of fiscal year 2014. Net loss per diluted
share for the first quarter of fiscal year 2015 was $0.11 on
approximately 14.1 million weighted average diluted common shares
outstanding, compared to net loss per diluted share of $0.09 on
approximately 14.0 million weighted average diluted common shares
outstanding in the same period of the prior year.
Management Comments
Harold Edwards, President and Chief Executive Officer, stated, "We are
pleased with our solid start in fiscal 2015. While our financial results
reflect the anticipated seasonality of our agribusiness, our top line
growth of 8% in the first quarter was driven by another strong
performance from our lemon business. Based on our year-to-date results
and outlook for the remainder of the year, we are reiterating our
previously issued annual guidance."
Mr. Edwards added, "We continue to make progress on our long-term growth
strategy. We recently announced that we expanded our agricultural lease
agreement with Cadiz, which increased Limoneira's total lemon tree
acreage in California. This is in-line with our key initiative to add
productive agricultural properties and complements a number of key
investments we have made over the past year, including our ongoing
expansion project of our Santa Paula packing house, which we expect to
become operational later this year, and investments in Arizona and
Chile."
Mr. Edwards concluded, "Regarding our real estate development business,
last month, we received the anticipated final requisite approval to
break ground on the Santa Paula Gateway project. We are extremely
excited to have cleared the final regulatory approval on this project
and to move forward with our plans. We intend to announce a development
partner in the coming months and remain optimistic that we will begin
construction in 2015. As the project progresses, we believe we are well
positioned to benefit from expected additional cash flow. This project
represents a key component of our long-term initiative to strategically
monetize our rich portfolio of assets."
Balance Sheet and Liquidity
During the first quart of fiscal year 2015, net cash used in operating
activities was $5.8 million, compared to $4.1 million in the same period
of the prior year. Net cash used in investing activities was $7.1
million in the first quarter of fiscal year 2015, compared to $4.8
million in the same period of the prior year, primarily related to the
Company's investments in the expansion of its lemon packing facilities
and additional farm worker housing units. Net cash provided by financing
activities was approximately $12.9 million for the first quarter of
fiscal year 2015, compared to $8.9 million in the same period of the
prior year. Long-term debt as of January 31, 2015 was $81.8 million,
compared to $67.7 million at the end of fiscal year 2014.
Real Estate Development
During the first quarter of fiscal year 2015, the Company executed its
on-going real estate development strategy by capitalizing real estate
development costs of $1.1 million. In the first quarter of fiscal year
2014, the Company capitalized real estate development costs of $0.9
million.
On February 17, 2015, the City of Santa Paula unanimously approved
Limoneira's updated East Area 1 Master Tentative Tract Map, Supplemental
Environmental Report ("SEIR"), and updated Development Agreement.
Following the vote, the property is now fully entitled, and Limoneira
has all the requisite approvals to break ground on the Santa Paula
Gateway project. Limoneira expects to commence construction on the
project in 2015, pending market conditions.
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 2015,
lemon sales were comprised of approximately 67% to U.S. and Canada-based
customers, 29% to domestic exporters, and 4% to international customers.
Alex Teague, Senior Vice President, stated, "We currently have over 160
lemon customers, underscoring the success of our sales team. We are well
positioned to benefit from investments that we have made in our
agribusiness in Chile, Arizona and California, including our expanded
agricultural lease agreement with Cadiz. Looking ahead, we will continue
to capitalize on selective and strategic acquisition opportunities and
execute on our long-term growth strategy."
On February 5, 2015, Limoneira and Cadiz Inc. (NASDAQ: CDZI) ("Cadiz")
announced that they expanded their existing agricultural lease agreement
to include an additional 200 acres. Limoneira acquired a total of 200
acres of lemon trees and associated irrigation lines from Cadiz and one
of its leasing tenants for approximately $1.2 million. Under the amended
lease agreement with Cadiz, Limoneira now has the right to plant up to
1,480 acres of lemons over the next three years at the Cadiz Ranch
operations in the Cadiz Valley.
The Company remains on-track to substantially complete its farm worker
housing project in fiscal year 2015, which is expected to add
approximately $0.9 million of rental revenue on an annual basis.
Fiscal Year 2015 Outlook
Due to a decrease in the estimated size of the 2015 lemon harvest
compared to what was previously anticipated, the Company is decreasing
the number of cartons of fresh lemons that it expects to sell in fiscal
year 2015 to approximately 3.0 million cartons of fresh lemons from its
previous guidance of between 3.2 million to 3.4 million cartons of fresh
lemons. Offsetting the expected reduction in sales volume, we anticipate
the average price per carton to increase to approximately $24.00 per
carton compared to previous guidance of an average price of $22.00 per
carton. In addition, the Company expects to sell approximately 6.5 to
7.5 million pounds of avocados at approximately $1.00 per pound.
However, certain of the Company's avocado orchards experienced freezing
temperatures during the first quarter of fiscal year 2015 which caused
damage to a portion of the fiscal year 2015 crop. The extent of the
damage is being assessed and is not expected to be known until the
second quarter of fiscal year 2015. The volume range of production noted
above reflects the Company's current estimate of production net of the
effects of the damage.
The Company expects operating income and net income for fiscal year 2015
to be similar to fiscal year 2014 operating income and net income as a
result of anticipated stable lemon and avocado revenue, depending on the
extent of avocado freeze damage noted above and lower orange and
specialty citrus revenues partially offset by lower expected selling,
general and administrative expenses.
In addition, subject to the extent of the avocado freeze damage noted
above, the Company expects to earn approximately $9.4 million to $10.2
million in operating income in fiscal year 2015, compared to $9.9
million of operating income in fiscal year 2015. Fiscal year 2015 income
before tax is expected to be approximately $10.4 million to $11.1
million, compared to $10.6 million of income before tax for fiscal year
2014. The Company expects fiscal year 2015 earnings per diluted share to
be in the range of $0.42 to $0.46, compared to fiscal year 2014 earnings
per diluted share of $0.46.
Until the Company has a definitive transaction for its Santa Paula
Gateway project, the potential effect on its financial condition,
results of operations or cash flows that would result from such a
transaction will not be reflected in its outlook.
Conference Call Information
The Company will host a conference call and audio webcast on March 9,
2015, at 1:30 pm Pacific Time (4:30 pm Eastern Time) to discuss its
financial results. To access the conference call, participants in the
U.S. should dial (888) 208-1386, and international participants should
dial (913) 312-0856. 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 23, 2015, by calling (877) 870-5176 from the U.S. or (858)
384-5517 from international locations to access the playback; passcode
is 7209607.
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 10,700
acres of rich agricultural lands, real estate properties and water
rights in California and Arizona. 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,
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
Net loss
|
|
$
|
(1,448,000
|
)
|
|
$
|
(1,219,000
|
)
|
|
Total interest expense (income), net
|
|
|
12,000
|
|
|
|
(20,000
|
)
|
|
Income tax benefit
|
|
|
(755,000
|
)
|
|
|
(717,000
|
)
|
|
Depreciation and amortization
|
|
|
989,000
|
|
|
|
817,000
|
|
|
EBITDA
|
|
$
|
(1,202,000
|
)
|
|
$
|
(1,139,000
|
)
|
|
|
|
Limoneira Company
|
|
|
|
Consolidated Balance Sheets (unaudited)
|
|
|
|
|
|
January 31,
|
|
October 31,
|
|
|
|
2015
|
|
2014
|
|
Assets
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash
|
|
$
|
104,000
|
|
$
|
92,000
|
|
Accounts receivable, net
|
|
|
11,319,000
|
|
|
7,236,000
|
|
Cultural costs
|
|
|
1,559,000
|
|
|
3,691,000
|
|
Prepaid expenses and other current assets
|
|
|
3,870,000
|
|
|
3,849,000
|
|
Income taxes receivable
|
|
|
1,898,000
|
|
|
1,143,000
|
|
Total current assets
|
|
|
18,750,000
|
|
|
16,011,000
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
111,478,000
|
|
|
105,433,000
|
|
Real estate development
|
|
|
89,245,000
|
|
|
88,088,000
|
|
Equity in investments
|
|
|
3,419,000
|
|
|
3,638,000
|
|
Investment in Calavo Growers, Inc.
|
|
|
20,055,000
|
|
|
24,270,000
|
|
Notes receivable
|
|
|
2,096,000
|
|
|
2,084,000
|
|
Other assets
|
|
|
8,271,000
|
|
|
8,114,000
|
|
Total assets
|
|
$
|
253,314,000
|
|
$
|
247,638,000
|
|
|
|
|
|
|
|
Liabilities and stockholders' equity
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable
|
|
$
|
8,148,000
|
|
$
|
6,363,000
|
|
Growers payable
|
|
|
6,165,000
|
|
|
5,839,000
|
|
Accrued liabilities
|
|
|
3,178,000
|
|
|
7,539,000
|
|
Fair value of derivative instrument
|
|
|
775,000
|
|
|
809,000
|
|
Current portion of long-term debt
|
|
|
582,000
|
|
|
583,000
|
|
Total current liabilities
|
|
|
18,848,000
|
|
|
21,133,000
|
|
Long-term liabilities:
|
|
|
|
|
|
Long-term debt, less current portion
|
|
|
81,775,000
|
|
|
67,771,000
|
|
Deferred income taxes
|
|
|
20,103,000
|
|
|
21,792,000
|
|
Other long-term liabilities
|
|
|
6,444,000
|
|
|
6,282,000
|
|
Total liabilities
|
|
|
127,170,000
|
|
|
116,978,000
|
|
Commitments and contingencies
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
Series B Convertible Preferred Stock - $100.00 par value (50,000
shares authorized: 30,000 shares issued and outstanding at January
31, 2015 and October 31, 2014) (8.75% coupon rate)
|
|
|
3,000,000
|
|
|
3,000,000
|
|
|
|
|
|
|
|
Series B-2 Convertible Preferred Stock - $100.00 par value (10,000
shares authorized: 9,300 shares issued and outstanding January 31,
2015 and October 31, 2014) (4% dividend rate on liquidation value
of $1,000 per share)
|
|
|
9,331,000
|
|
|
9,331,000
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
Series A Junior Participating Preferred Stock - $.01 par value
(20,000 shares authorized: 0 issued or outstanding at January 31,
2015 and October 31, 2014)
|
|
|
-
|
|
|
-
|
|
Common Stock - $.01 par value (19,900,000 shares authorized:
14,124,332 and 14,078,077 shares issued and outstanding at January
31, 2015 and October 31, 2014, respectively)
|
|
|
141,000
|
|
|
140,000
|
|
Additional paid-in capital
|
|
|
90,064,000
|
|
|
89,770,000
|
|
Retained earnings
|
|
|
21,066,000
|
|
|
23,308,000
|
|
Accumulated other comprehensive income
|
|
|
2,542,000
|
|
|
5,111,000
|
|
Total stockholders' equity
|
|
|
113,813,000
|
|
|
118,329,000
|
|
Total liabilities and stockholders' equity
|
|
$
|
253,314,000
|
|
$
|
247,638,000
|
|
|
|
Limoneira Company
|
|
|
|
Consolidated Statements of Operations (unaudited)
|
|
|
|
|
|
Three months ended
|
|
|
|
January 31,
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
Revenues:
|
|
|
|
|
|
Agribusiness
|
|
$
|
26,883,000
|
|
|
$
|
24,704,000
|
|
|
Rental operations
|
|
|
1,118,000
|
|
|
|
1,134,000
|
|
|
Real estate development
|
|
|
10,000
|
|
|
|
44,000
|
|
|
Total revenues
|
|
|
28,011,000
|
|
|
|
25,882,000
|
|
|
Costs and expenses:
|
|
|
|
|
|
Agribusiness
|
|
|
25,814,000
|
|
|
|
23,462,000
|
|
|
Rental operations
|
|
|
805,000
|
|
|
|
728,000
|
|
|
Real estate development
|
|
|
242,000
|
|
|
|
344,000
|
|
|
Selling, general and administrative
|
|
|
3,667,000
|
|
|
|
3,541,000
|
|
|
Total costs and expenses
|
|
|
30,528,000
|
|
|
|
28,075,000
|
|
|
Operating loss
|
|
|
(2,517,000
|
)
|
|
|
(2,193,000
|
)
|
|
Other income (expense):
|
|
|
|
|
|
Interest income (expense), net
|
|
|
(12,000
|
)
|
|
|
20,000
|
|
|
Equity in earnings of investments
|
|
|
85,000
|
|
|
|
84,000
|
|
|
Other income, net
|
|
|
241,000
|
|
|
|
153,000
|
|
|
Total other income
|
|
|
314,000
|
|
|
|
257,000
|
|
|
|
|
|
|
|
|
Loss before income tax benefit
|
|
|
(2,203,000
|
)
|
|
|
(1,936,000
|
)
|
|
|
|
|
|
|
|
Income tax benefit
|
|
|
755,000
|
|
|
|
717,000
|
|
|
Net loss
|
|
|
(1,448,000
|
)
|
|
|
(1,219,000
|
)
|
|
Preferred dividends
|
|
|
(159,000
|
)
|
|
|
(66,000
|
)
|
|
Net loss applicable to common stock
|
|
$
|
(1,607,000
|
)
|
|
$
|
(1,285,000
|
)
|
|
|
|
|
|
|
|
Basic net loss per common share
|
|
$
|
(0.11
|
)
|
|
$
|
(0.09
|
)
|
|
|
|
|
|
|
|
Diluted net loss per common share
|
|
$
|
(0.11
|
)
|
|
$
|
(0.09
|
)
|
|
|
|
|
|
|
|
Dividends per common share
|
|
$
|
0.04
|
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding-basic
|
|
|
14,098,000
|
|
|
|
14,030,000
|
|
|
Weighted-average common shares outstanding-diluted
|
|
|
14,098,000
|
|
|
|
14,030,000
|
|
Investor Contact:
ICR
John Mills
Partner
646-277-1254
Source: Limoneira Company
News Provided by Acquire Media
