SANTA PAULA, CA - Calavo Growers, Inc., a global avocado industry leader and provider of value-added fresh food, reported its financial results for the fiscal first quarter ended January 31, 2025.
First Quarter Financial Overview
- Total net sales of $154.4 million, a 21.0% increase from the prior year quarter.
- Fresh1 segment sales increased $26.8 million, or 23.7%, from the prior year quarter.
- Prepared segment sales remained essentially flat from the prior year quarter.
- Gross profit of $15.7 million, a 46.2% increase from the prior year quarter.
- Fresh segment gross profit of $12.1 million, an 88.8% increase from the prior year quarter.
- Prepared segment gross profit of $3.6 million, a 17.1% decrease from the prior year quarter.
- Selling, general, and administrative (SG&A) expenses of $10.3 million, a decrease of 23.6% from the prior year quarter.
- Net income from continuing operations of $4.4 million, or $0.25 per diluted share, compared to a net loss from continuing operations of $2.6 million, or $(0.15) per diluted share from the prior year quarter.
- Adjusted net income2 of $5.9 million, or $0.33 per diluted share, compared to adjusted net loss of $1.4 million in the prior year quarter or $(0.08) per share.
- Adjusted EBITDA2 of $9.3 million, compared to adjusted EBITDA of $3.1 million in the prior year quarter.
First Quarter Highlights for Continuing Operations
- Fresh segment sales had significant revenue growth, driven by a 30.5% increase in average price per carton, which more than offset a 4.6% decline in volume.
- Prepared segment net sales remained steady as a 7.3% increase in volume was largely offset by lower average selling prices per pound.
Gross profit benefited from stronger avocado margins primarily due to the combination of higher average selling prices and lower fruit costs.
SG&A expenses declined significantly as a result of our ongoing focus on cost discipline and lower professional expenses. - We continue to cooperate fully with the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ) investigations relating to the Foreign Corrupt Practices Act (FCPA). On February 18, 2025, the SEC notified us that activity in the investigation has been postponed after President Trump issued Executive Orders on February 10 and February 18, 2025. Given the Attorney General’s February 5, 2025 Memo and the President’s Executive Orders, indicating a shift in DOJ and SEC priorities, we do not currently anticipate any near-term action from the government’s FCPA inquiry that would likely have a material impact on our short-term financial outlook.
- The Board of Directors declared a quarterly cash dividend of $0.20 per share to be paid on April 29, 2025, to shareholders of record on April 1, 2025.
- After quarter end, we achieved a significant milestone in our tax strategy, as the Mexican tax authorities (SAT) refunded 13.7 million Mexican pesos in VAT (approximately $0.7 million USD), including inflationary adjustments, for March 2019. We believe this favorable resolution—secured directly from the tax authority rather than through the court system—reinforces the strength of our approach and provides positive momentum as we continue working to recover additional outstanding refunds. For further discussion on our VAT recovery efforts, please see Note 9 to our consolidated financial statements in our Form 10-Q for the quarter ended January 31, 2025.
Management Commentary
“Our first quarter results reflect the strongest Q1 adjusted net income performance we’ve delivered since 2019,” said Lee Cole, President and Chief Executive Officer of Calavo Growers, Inc., in a recent press release. “Our strategic focus on margin improvement and operational efficiency is driving tangible results, with Fresh segment sales increasing about 24% and overall net sales up about 21% year-over-year.
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