Limoneira Company (LMNR) Q2 2024 earnings summary

Executive summary

• Adjusted EBITDA for Q2 2024 more than doubled year-over-year to $16.6 million, driven by strong real estate joint venture performance and strategic avocado harvest timing.

• Net income for Q2 2024 was $6.6 million, reversing a prior-year loss, supported by real estate JV gains and improved operational performance.

• Strategic shift underway to expand avocado acreage by 1,000 acres over three years, targeting 2,000 acres and long-term EBITDA of $45–$55 million by 2030.

• Real estate JV completed Phase II lot sales, received city approval to increase total residential units to 2,050, and boosted future cash flow projections by 46% to $180 million over seven years.

• The company is conducting a strategic review, including potential sale or merger, and is transitioning to an asset-lighter business model.

Financial highlights

• Q2 2024 net revenue was $44.6 million, down 7% year-over-year, with agribusiness revenue at $43.3 million and other operations at $1.3 million.

• Operating loss for Q2 2024 was $4.7 million, compared to $3.9 million loss in Q2 2023.

• Net income applicable to common stock was $6.4 million, reversing a $1.7 million loss in Q2 2023; diluted EPS was $0.35 versus a $0.10 loss.

• Adjusted net income for diluted EPS was $8.1 million ($0.44/share), up from $3.9 million ($0.21/share) in Q2 2023.

• Six-month net revenues were $84.3 million, down 2% year-over-year; net income for the period was $2.9 million, down from $13.9 million.

Outlook and guidance

• Fresh lemon volume guidance for FY24 remains 5–5.5 million cartons; avocado volume guidance raised to 9–10 million pounds from 7–8 million.

• Long-term EBITDA target increased to $45–$55 million by FY2030, driven by avocado expansion.

• Real estate proceeds expected to total $180 million over seven years, up 46% from prior guidance.

• FY25 and FY26 operational results expected to be similar to FY24 as avocado plantings mature.

• Management expects continued volatility in export markets and ongoing impacts from the COVID-19 pandemic.