Santa Paula-based fruit grower Limoneira Co.’s second-quarter profits fell 16.7 percent to $2 million despite higher revenue and operating income.
The earnings decrease was affected by Limoneira’s sale last year of 165,000 shares of Santa Paula-based Calavo Growers, a transaction that netted a $3.1 million gain in the second quarter of 2013. Limoneira’s earnings per diluted share dropped to 15 cents in the most recent quarter, compared to 19 cents a year ago.
Limoneira’s operating income jumped 35 percent to $3.2 million, prompting it to raise its full-year outlook. The firm now expects operating income of between $10.6 million and $11.8 million for the full year, compared to previous guidance of $7 million. Large orchard acquisitions in Arizona and California, coupled with higher lemon prices, prompted the more positive outlook.
With second-quarter operating income of $3.2 million on quarterly revenue of $24.8 million, the company brought in more revenue from lemons sold even as the volume shipped declined. Lemon sales increased to $18.1 million in the second quarter, up from $15.5 million a year earlier, on “significantly higher” than average lemon prices, Limoneira said.
“Our second-quarter financial results reflect the steady progress we are making with our business,” Limoneira CEO and President Harold Edwards said in a statement. “We continue to grow our top line, reflecting our expanding agribusiness, including our lemon and citrus sales. We also remain pleased with the contributions of our acquired orchards, which generated approximately $2.6 million of operating income in the first half of fiscal year 2014. In the second quarter, we reduced our long-term debt, paying down over $10 million in debt in the quarter.”
Avocado sales and specialty citrus sales both dropped around 50 percent to $1.2 million and $900,000, respectively, while quarterly orange revenue jumped almost 50 percent to $3.4 million.
Despite California’s record-breaking drought, Edwards said the company will have enough water. “We continue to believe that our extensive water rights, usage rights and pumping rights will provide us with adequate supplies of water as we begin our seasonally strongest quarter of the year,” he said.
Limoneira shares closed up 0.5 percent to $23.20 after the June 10 earnings release.