Fiscal First Quarter 2024 Financial Overview:
- Total revenue increased 21% to
$258.7 million compared to the same period last year driven primarily by a 23% increase in average per-unit avocado selling prices on flat avocado volumes - Net income/(loss) was breakeven, or
$0.00 per diluted share, compared to$(8.8) million , or$(0.12) per diluted share, for the same period last year - Adjusted net income of
$6.7 million , or$0.09 per diluted share, compared to$(5.0) million , or$(0.07) per diluted share, for the same period last year - Adjusted EBITDA of
$19.2 million , compared to$2.3 million in the same period last year
CEO Message
Fiscal First Quarter 2024 Consolidated Financial Review
Total revenue for the first quarter of fiscal 2024 increased
Gross profit increased
Selling, general and administrative expense (“SG&A”) for the first quarter increased
Net loss for the first quarter of fiscal 2024 was breakeven, or
Adjusted net income for the first quarter of fiscal 2024 was
Adjusted EBITDA was
Fiscal First Quarter Business Segment Performance
Marketing & Distribution
Net sales in the Marketing & Distribution segment increased 24% to
Segment adjusted EBITDA increased
International Farming
The vast majority of fruit sales from the International Farming segment are made to the Marketing and Distribution segment, with the remainder of revenue largely derived from services provided to third parties and the Blueberries segment. Affiliated sales are concentrated in the second half of the fiscal year in alignment with the Peruvian avocado harvest season, which typically runs from April through September of each year. As a result, adjusted EBITDA for the International Farming segment is generally concentrated in the third and fourth quarters of the fiscal year in alignment with the timing of sales. In addition, the Company operates approximately 700 acres of mangos in
Total segment sales in the International Farming segment for the first quarter of fiscal 2024 were approximately flat with the prior year period at
Segment adjusted EBITDA increased
Blueberries
Sales in the Blueberries segment have been concentrated in the first and fourth quarters of the fiscal year in alignment with the Peruvian blueberry harvest season, which typically runs from July through February.
Net sales in the Blueberries segment increased 9% to
Segment adjusted EBITDA increased by
Balance Sheet and Cash Flow
Cash and cash equivalents were
The Company’s operating cash flows are seasonal in nature and can be temporarily influenced by working capital shifts resulting from varying payment terms to growers in different source regions. In addition, the Company is building its growing crops inventory in its International Farming segment during the first half of the year for ultimate harvest and sale that will occur during the second half of the fiscal year. While these increases in working capital can cause operating cash flows to be unfavorable in individual quarters, it is not indicative of operating cash performance that management expects to realize for the full year.
Net cash provided by operating activities was
Capital expenditures were
Outlook
For the second quarter of fiscal year 2024, the Company is providing the following industry outlooks that will drive performance:
- The industry is expecting avocado volumes to be relatively flat in the fiscal 2024 second quarter versus the prior year period. Industry volumes from
Mexico are expected to taper off in the latter part of the quarter as the season nears completion.California harvest volumes should begin to build toward the middle of the quarter, followed by small amounts of Peruvian volume later in the fiscal second quarter. - Avocado pricing is expected to be slightly higher on a sequential basis and be approximately 10-15% higher than the
$1.30 per pound average experienced in second quarter of fiscal 2023. - Harvest timing shifts relative to last year have extended the Company’s Peruvian blueberry season this year. As a result, approximately 20% of the harvest will be sold through in the fiscal second quarter, whereas the season was substantially complete in the prior year period. Sales pricing is expected to decline sequentially in the fiscal second quarter in response to increased industry volume resulting from the expectation for other source regions to begin seasonal harvests on a normal cadence.
Conference Call and Webcast
As previously announced, the Company will host a conference call to discuss its first quarter of fiscal 2024 financial results today at
The live audio webcast of the conference call will be accessible in the News & Events section on the Company's Investor Relations website at https://investors.missionproduce.com. An archived replay of the webcast will also be available shortly after the live event has concluded.
Non-GAAP Financial Measures
This press release contains the non-GAAP financial measures “adjusted net income” and “adjusted EBITDA.” Management believes these measures provide useful information for analyzing the underlying business results. These measures are not in accordance with, nor are they a substitute for or superior to, the comparable financial measures by generally accepted accounting principles.
Adjusted EBITDA refers to net income (loss), before interest expense, income taxes, depreciation and amortization expense, stock-based compensation expense, other income (expense), and income (loss) from equity method investees, further adjusted by asset impairment and disposals, net of insurance recoveries, farming costs for nonproductive orchards (which represents land lease costs), certain noncash and nonrecurring ERP costs, transaction costs, amortization of inventory adjustments recognized from business combinations, and any special, non-recurring, or one-time items such as remeasurements or impairments, and any portion of these items attributable to the noncontrolling interest, all of which are excluded from the results the CEO reviews uses to assess segment performance and results.
Reconciliations of these non-GAAP financial measures to the most comparable GAAP measure are provided in the table at the end of this press release.
About
Forward-Looking Statements
Statements in this press release that are not historical in nature are forward-looking statements that, within the meaning of the federal securities laws, including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, involve known and unknown risks and uncertainties. Words such as "may", "will", "expect", "intend", "plan", "believe", "seek", "could", "estimate", "judgment", "targeting", "should", "anticipate", "goal" and variations of these words and similar expressions, are also intended to identify forward-looking statements. The forward-looking statements in this press release address a variety of subjects, including statements about our short-term and long-term assumptions, goals and targets. Many of these assumptions relate to matters that are beyond our control and changing rapidly. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurances that our expectations will be attained. Readers are cautioned that actual results could differ materially from those implied by such forward-looking statements due to a variety of factors, including: limitations regarding the supply of fruit, either through purchasing or growing; fluctuations in the market price of fruit; increasing competition; risks associated with doing business internationally, including Mexican and Peruvian economic, political and/or societal conditions; inflationary pressures; establishment of sales channels and geographic markets; loss of one or more of our largest customers; general economic conditions or downturns; supply chain failures or disruptions; disruption to the supply of reliable and cost-effective transportation; failure to recruit or retain employees, poor employee relations, and/or ineffective organizational structure; inherent farming risks, including climate change; seasonality in operating results; failures associated with information technology infrastructure, system security and cyber risks; new and changing privacy laws and our compliance with such laws; food safety events and recalls; failure to comply with laws and regulations; changes to trade policy and/or export/import laws and regulations; risks from business acquisitions, if any; lack of or failure of infrastructure; material litigation or governmental inquiries/actions; failure to maintain or protect our brand; changes in tax rates or international tax legislation; risks associated with global conflicts; inability to accurately forecast future performance; the viability of an active, liquid, and orderly market for our common stock; volatility in the trading price of our common stock; concentration of control in our executive officers, and directors over matters submitted to stockholders for approval; limited sources of capital appreciation; significant costs associated with being a public company and the allocation of significant management resources thereto; reliance on analyst reports; failure to maintain proper and effective internal control over financial reporting; restrictions on takeover attempts in our charter documents and under
You can obtain copies of our
Contacts:
Investor Relations
ICR
646-277-1263
jeff.sonnek@icrinc.com
Media
Marketing Communications Manager
press@missionproduce.com
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
(In millions, except for shares) | |||||||
Assets | |||||||
Current Assets: | |||||||
Cash and cash equivalents | $ | 39.9 | $ | 42.9 | |||
Restricted cash | 0.6 | 0.3 | |||||
Accounts receivable | |||||||
Trade, net of allowances | 85.3 | 74.1 | |||||
Grower and fruit advances | 1.4 | 0.9 | |||||
Other | 13.1 | 12.4 | |||||
Inventory | 85.9 | 70.8 | |||||
Prepaid expenses and other current assets | 9.1 | 9.1 | |||||
Income taxes receivable | 9.2 | 9.6 | |||||
Total current assets | 244.5 | 220.1 | |||||
Property, plant and equipment, net | 525.2 | 523.2 | |||||
Operating lease right-of-use assets | 71.4 | 72.4 | |||||
Equity method investees | 28.6 | 31.0 | |||||
Deferred income tax assets, net | 8.7 | 8.5 | |||||
39.4 | 39.4 | ||||||
Intangible asset, net | 0.2 | 0.5 | |||||
Other assets | 19.5 | 19.7 | |||||
Total assets | $ | 937.5 | $ | 914.8 | |||
Liabilities and Equity | |||||||
Liabilities | |||||||
Accounts payable | $ | 26.7 | $ | 27.2 | |||
Accrued expenses | 29.1 | 26.4 | |||||
Income taxes payable | 2.8 | 1.6 | |||||
Grower payables | 36.9 | 26.4 | |||||
Short-term borrowings | — | 2.8 | |||||
Loans from noncontrolling interest holders—current portion | 0.2 | 0.5 | |||||
Notes payable | 0.5 | — | |||||
Long-term debt—current portion | 3.3 | 3.4 | |||||
Operating leases—current portion | 7.0 | 6.6 | |||||
Finance leases—current portion | 1.4 | 2.6 | |||||
Total current liabilities | 107.9 | 97.5 | |||||
Long-term debt, net of current portion | 152.8 | 148.6 | |||||
Loans from noncontrolling interest holders, net of current portion | 1.8 | 2.5 | |||||
Operating leases, net of current portion | 70.3 | 71.0 | |||||
Finance leases, net of current portion | 20.1 | 14.7 | |||||
Income taxes payable | 2.3 | 2.3 | |||||
Deferred income tax liabilities, net | 22.8 | 23.5 | |||||
Other long-term liabilities | 27.7 | 26.4 | |||||
Total liabilities | 405.7 | 386.5 | |||||
Equity | |||||||
505.1 | 503.6 | ||||||
Noncontrolling interest | 26.7 | 24.7 | |||||
Total equity | 531.8 | 528.3 | |||||
Total liabilities and equity | $ | 937.5 | $ | 914.8 |
Condensed Consolidated Statements of Income (Loss) (Unaudited) | |||||||
Three Months Ended | |||||||
(In millions, except for share and per share amounts) | 2024 | 2023 | |||||
Net sales | $ | 258.7 | $ | 213.5 | |||
Cost of sales | 230.0 | 204.5 | |||||
Gross profit | 28.7 | 9.0 | |||||
Selling, general and administrative expenses | 20.7 | 19.1 | |||||
Operating income (loss) | 8.0 | (10.1 | ) | ||||
Interest expense | (3.3 | ) | (2.4 | ) | |||
Equity method income | 0.4 | 1.0 | |||||
Other expense, net | (1.0 | ) | (0.8 | ) | |||
Income (loss) before income taxes | 4.1 | (12.3 | ) | ||||
Provision (benefit) for income taxes | 2.1 | (1.7 | ) | ||||
Net income (loss) | $ | 2.0 | $ | (10.6 | ) | ||
Less: | |||||||
Net income (loss) attributable to noncontrolling interest | 2.0 | (1.8 | ) | ||||
Net loss attributable to | $ | — | $ | (8.8 | ) | ||
Net loss per share attributable to | |||||||
Basic | $ | 0.00 | $ | (0.12 | ) | ||
Diluted | $ | 0.00 | $ | (0.12 | ) | ||
Weighted average shares of common stock outstanding, used in computing diluted earnings per share | 70,761,022 | 70,688,785 |
Condensed Consolidated Statements of Cash Flow (Unaudited) | |||||||
Three Months Ended | |||||||
(In millions) | 2024 | 2023 | |||||
Operating Activities | |||||||
Net income (loss) | $ | 2.0 | $ | (10.6 | ) | ||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities | |||||||
Depreciation and amortization | 12.9 | 9.3 | |||||
Amortization of debt issuance costs | 0.1 | 0.1 | |||||
Equity method income | (0.4 | ) | (1.0 | ) | |||
Noncash lease expense | 1.5 | 1.4 | |||||
Stock-based compensation | 1.4 | 0.7 | |||||
Dividends received from equity method investees | 3.2 | 2.7 | |||||
Losses on asset impairment, disposals and sales, net of insurance recoveries | 0.2 | 0.3 | |||||
Deferred income taxes | (0.8 | ) | (0.5 | ) | |||
Other | 0.9 | 0.1 | |||||
Effect on cash of changes in operating assets and liabilities: | |||||||
Trade accounts receivable | (10.9 | ) | (1.2 | ) | |||
Grower fruit advances | (0.5 | ) | — | ||||
Other receivables | (0.7 | ) | 6.1 | ||||
Inventory | (14.8 | ) | (3.8 | ) | |||
Prepaid expenses and other current assets | — | 0.8 | |||||
Income taxes receivable | 0.3 | (3.2 | ) | ||||
Other assets | 0.1 | (1.2 | ) | ||||
Accounts payable and accrued expenses | 4.6 | (1.7 | ) | ||||
Income taxes payable | 1.2 | (0.5 | ) | ||||
Grower payables | 10.1 | 1.1 | |||||
Operating lease liabilities | (0.9 | ) | (1.4 | ) | |||
Other long-term liabilities | — | 1.2 | |||||
Net cash provided by (used in) operating activities | $ | 9.5 | $ | (1.3 | ) | ||
Investing Activities | |||||||
Purchases of property, plant and equipment | (9.9 | ) | (17.6 | ) | |||
Investment in equity method investees | — | (0.3 | ) | ||||
Net cash used in investing activities | $ | (9.9 | ) | $ | (17.9 | ) | |
Financing Activities | |||||||
Borrowings on revolving credit facility | 15.0 | 10.0 | |||||
Payments on revolving credit facility | (10.0 | ) | — | ||||
Repayment of short-term borrowings | (2.8 | ) | (2.5 | ) | |||
Principal payments on long-term debt obligations | (0.9 | ) | (0.9 | ) | |||
Principal payments on finance lease obligations | (2.3 | ) | (1.7 | ) | |||
Payments for long-term supplier financing | (0.3 | ) | — | ||||
Principal payments on loans due to noncontrolling interest holder | (0.5 | ) | — | ||||
Payments of minimum withholding taxes on net share settlement of equity awards | (0.7 | ) | (0.4 | ) | |||
Equity contributions from noncontrolling interest holders | — | 1.0 | |||||
Net cash (used in) provided by financing activities | $ | (2.5 | ) | $ | 5.5 | ||
Effect of exchange rate changes on cash | 0.2 | — | |||||
Net decrease in cash, cash equivalents and restricted cash | (2.7 | ) | (13.7 | ) | |||
Cash, cash equivalents and restricted cash, beginning of period | 43.2 | 53.9 | |||||
Cash, cash equivalents and restricted cash, end of period | $ | 40.5 | $ | 40.2 | |||
Summary of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets: | |||||||
Cash and cash equivalents | $ | 39.9 | $ | 39.2 | |||
Restricted cash | 0.6 | 1.0 | |||||
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows | $ | 40.5 | $ | 40.2 |
Reconciliation of Non-GAAP Financial Measures to GAAP (Unaudited) |
The following tables reconcile the non-GAAP measures “adjusted net income” and “adjusted EBITDA” to their comparable GAAP measures. Refer also to “Non-GAAP Financial Measures” earlier in this press release.
Adjusted Net Income (Loss) | |||||||
Three Months Ended | |||||||
(In millions, except for per share amounts) | 2024 | 2023 | |||||
Net loss attributable to | $ | — | $ | (8.8 | ) | ||
Stock-based compensation | 1.4 | 0.7 | |||||
Unrealized loss on derivative financial instruments | 0.2 | 0.6 | |||||
Foreign currency transaction loss | 1.4 | 0.9 | |||||
Asset impairment and disposals, net of insurance recoveries | 0.2 | 0.3 | |||||
Farming costs for nonproductive orchards(1) | 1.2 | 0.9 | |||||
ERP costs(2) | 0.5 | 0.6 | |||||
Depreciation-blueberries(3) | 4.1 | — | |||||
Severance | 1.3 | — | |||||
Legal settlement | 0.2 | — | |||||
Amortization of intangible asset recognized from business combination | 0.3 | 1.2 | |||||
Transaction costs | — | 0.1 | |||||
Amortization of inventory adjustment recognized from business combination | — | 0.7 | |||||
Tax effects of adjustments to net loss attributable to | (2.3 | ) | (1.3 | ) | |||
Noncontrolling interest(5) | (1.8 | ) | (0.9 | ) | |||
$ | 6.7 | $ | (5.0 | ) | |||
$ | 0.09 | $ | (0.07 | ) |
(1) | During the three months ended |
(2) | Recognition of deferred implementation costs. |
(3) | Represents accelerated depreciation expense for certain blueberry plants determined to have no remaining useful life. |
(4) | Tax effects are calculated using applicable rates that each adjustment relates to. |
(5) | Represents net income or loss attributable to noncontrolling interest plus the impact of tax-effected non-GAAP adjustments, allocable to the noncontrolling owner based on their percentage of ownership interest. |
Adjusted EBITDA | |||||||
Three Months Ended | |||||||
(In millions) | 2024 | 2023 | |||||
Marketing and Distribution adjusted EBITDA | $ | 11.0 | $ | 4.6 | |||
International Farming adjusted EBITDA | (0.5 | ) | (1.8 | ) | |||
Blueberries adjusted EBITDA | 8.7 | (0.5 | ) | ||||
Total reportable segment adjusted EBITDA | 19.2 | 2.3 | |||||
Net income (loss) | 2.0 | (10.6 | ) | ||||
Interest expense | 3.3 | 2.4 | |||||
Provision (benefit) for income taxes | 2.1 | (1.7 | ) | ||||
Depreciation and amortization(1) | 12.9 | 9.3 | |||||
Equity method income | (0.4 | ) | (1.0 | ) | |||
Stock-based compensation | 1.4 | 0.7 | |||||
Asset impairment and disposals, net of insurance recoveries | 0.2 | 0.3 | |||||
Farming costs for nonproductive orchards | 0.5 | 0.4 | |||||
ERP costs(2) | 0.5 | 0.6 | |||||
Severance | 1.3 | — | |||||
Legal settlement | 0.2 | — | |||||
Transaction costs | — | 0.1 | |||||
Amortization of inventory adjustment recognized from business combination | — | 0.7 | |||||
Other expense, net | 1.0 | 0.8 | |||||
Noncontrolling interest(3) | (5.8 | ) | 0.3 | ||||
Total adjusted EBITDA | $ | 19.2 | $ | 2.3 |
(1) | Includes depreciation and amortization of purchase accounting assets of |
(2) | Recognition of deferred ERP implementation costs. |
(3) | Represents net income (loss) attributable to noncontrolling interest plus the impact of non-GAAP adjustments, allocable to the noncontrolling owner based on their percentage of ownership interest. |
Other Information (Unaudited) | |||||||||||||||||||||||||||||||
Segment Sales | |||||||||||||||||||||||||||||||
Marketing and Distribution | International Farming | Blueberries | Total | Marketing and Distribution | International Farming | Blueberries | Total | ||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||
(In millions) | 2024 | 2023 | |||||||||||||||||||||||||||||
Third party sales | $ | 224.6 | $ | 1.6 | $ | 32.5 | $ | 258.7 | $ | 181.8 | $ | 1.9 | $ | 29.8 | $ | 213.5 | |||||||||||||||
Affiliated sales | — | 4.2 | — | 4.2 | — | 3.8 | — | 3.8 | |||||||||||||||||||||||
Total segment sales | 224.6 | 5.8 | 32.5 | 262.9 | 181.8 | 5.7 | 29.8 | 217.3 | |||||||||||||||||||||||
Intercompany eliminations | — | (4.2 | ) | — | (4.2 | ) | — | (3.8 | ) | — | (3.8 | ) | |||||||||||||||||||
Total net sales | $ | 224.6 | $ | 1.6 | $ | 32.5 | $ | 258.7 | $ | 181.8 | $ | 1.9 | $ | 29.8 | $ | 213.5 |
Avocado Sales | |||||||
Three Months Ended | |||||||
2024 | 2023 | ||||||
Pounds of avocados sold (millions) | 151.6 | 152.3 | |||||
Average sales price per pound | $ | 1.40 | $ | 1.14 |
Sales by Type | |||||||
Three Months Ended | |||||||
(In millions) | 2024 | 2023 | |||||
Avocado | $ | 212.3 | $ | 174.0 | |||
Other | 46.4 | 39.5 | |||||
Total net sales | $ | 258.7 | $ | 213.5 |
Source:
2024 GlobeNewswire, Inc., source