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Jan 31, 2023
Calavo Growers Q1 2023 Earnings Report
Calavo Growers experienced a challenging first quarter due to market conditions in both Grown and Prepared segments, with Grown segment impacted by low avocado prices and Prepared segment affected by volume softness and winter weather.
Key Takeaways
Calavo Growers reported a decrease in total revenue by 18% year-over-year, with Grown segment revenue declining by 27% and Prepared segment revenue decreasing by 3%. The company experienced a net loss of $(3.1) million, or $(0.17) per diluted share, which is an improvement compared to the previous year's net loss of $(4.0) million, or $(0.23) per diluted share.
Total revenue decreased 18% year-over-year to $226.2 million.
Grown segment revenue decreased 27% year-over-year to $117.7 million.
Prepared segment revenue decreased 3% year-over-year to $108.5 million.
Net loss improved to $(3.1) million, or $(0.17) per diluted share, compared to $(4.0) million, or $(0.23) per diluted share, for the same period last year.
Revenue by Segment
Forward Guidance
Calavo Growers anticipates adjusted EBITDA in the range of $40 to $45 million for fiscal year 2023. Grown Segment fiscal 2023 avocado gross margins per case are expected to be at or near the low end of our $3 to $4 target range. Fiscal 2023 gross margins in the fresh cut division will be at or near the low end of the 10%-12% gross margin range exiting fiscal 2023 as volume softness is expected to persist in the near term. Gross margins in the guacamole division are expected to approximate 20% for fiscal 2023.
Positive Outlook
- Grown segment market conditions started to recover in late January.
- Avocado margins realized within targeted range of $3 to $4 per case for most of the second quarter.
- New customer distribution points and volume are still scheduled to launch in the second half.
- Company remains focused on making changes to the business that will deliver ongoing value.
- Restructuring certain corporate and administrative functions to upgrade capabilities and to reduce costs.
Challenges Ahead
- Supply pressure may lead to ongoing volatility in avocado margins.
- Volume softness in Prepared may persist in the near term.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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