Limoneira Reports Strong Q3 2024 with 21% Revenue Growth

Limoneira's Q3 2024 earnings show significant net revenue growth, increased adjusted EBITDA, and a positive outlook for avocado production, which may impact investor confidence and stock prices.

Date: 10-09-2024

AI Rating: 7

In the earnings call for the third quarter of fiscal year 2024, Limoneira (NASDAQ: LMNR) reported a robust performance characterized by a 21% net revenue growth, reaching $63.3 million compared to $52.5 million in the same quarter last year. This growth is largely attributed to improved pricing in the fresh lemon segment and increased demand for avocados, achieving an all-time record for avocado revenue.

The adjusted EBITDA for the quarter stood at $13.8 million, a substantial increase from $2.8 million in Q3 2023. This indicates a strong operational performance and indicates potential for higher profitability in the future.

Notably, the company reported a net income applicable to common stock of $6.5 million in Q3 2024, reversing from a net loss of $1.3 million in the same period last year. The net income per diluted share was $0.35, contrasting with a net loss of $0.07 last year. Adjusted net income per diluted share increased to $0.42 from $0.02, showcasing significant operational improvements.

Furthermore, the company strategically postponed a significant portion of its avocado harvest from Q2 to Q3 2024, allowing it to benefit from higher pricing due to a temporarily undersupplied market caused by Mexican border closures during peak season. Looking ahead, Limoneira has raised its avocado guidance for fiscal year 2024 by more than 50%, expecting volumes to reach between 14.5 million to 15.5 million pounds.

Investors should also take note of Limoneira's real estate development activities, which include the completion of substantial residential units and an increase in the number of units approved for future developments. These projects are expected to enhance cash flow and asset value considerably. Moreover, a reduction in the company’s net debt has positioned it favorably for future growth.

However, the call also indicated that while the company is optimistic about the avocado crop for 2024, it anticipates fluctuations in pricing due to international circumstances and normal production cycles. Overall, the significant growth in revenue and EBITDA, alongside the company's strategic expansion plans and reduction in debt, could lead to positive stock performance moving forward.

Stocks: LMNR