Revenue was down for the second consecutive quarter at Oxnard-based Mission Produce, but net income was on the rise in the first quarter of 2021, according to the company’s March 10 earnings statement.
Mission Produce, which is one of the biggest avocado distributors in the world, generate revenue in the first quarter worth $173.2 million, a 12% decrease compared to the same period last year.
Like Limoneira and Calavo Growers—both of which released their quarterly earnings reports on March 10 as well—the reason for the drop in revenue is due to low pricing because of the COVID-19 pandemic.
In the first quarter of 2021, Mission’s avocado volume sales increased 7% as the company sold 162.9 million pounds of avocados, compared to 152.2 million pounds in the same quarter of 2020, but the average price dropped 18%, to $1.04 per pound in 2021.
“All prices fluctuate given the influences of global supply and demand. This is not something Mission can control or forecast with any degree of certainty,” CFO Brian Giles said during the company’s earnings call.
Mission CEO Steve Barnard also said in a company news release that he expects prices to rise soon.
“We are beginning to see some increase, which if sustainable would create a positive environment for our International Farming segment in the back half of this fiscal year,” Barnard said in the release. “We believe this is evidence that the avocado is officially a staple in consumer diets today and should continue to support long-term consumption growth.”
Despite a drop in revenue, Mission was still able to produce income growth. Net income in the first quarter was $2.2 million, 3 cents per share, higher than the same period last year, when it produced net income of $1.4 million, or 2 cents per share.
Gross profit also saw an increase, up 17% to $22.7 million, while gross profit margins increased 328 basis points to 13.1% of revenue.
Mission attributed that to a combination of higher volume and higher margin per unit sold, which are driven by lower packaging costs as well as favorable leveraging of fixed-cost overhead, according to the press release.
Mission released its financial results after the trading day was over with the stock closing at $21.21 on March 10. It opened down slightly the next morning, at $20.80.