Calavo(CVGW) - 2025 Q1 - Quarterly Report

Financial Performance - Net sales for the three months ended January 31, 2025, increased to $154,385,000, up from $127,606,000 in the same period last year, representing a growth of 20.9%[11] - Gross profit for the same period rose to $15,728,000, compared to $10,760,000, marking an increase of 46.2%[11] - Operating income improved significantly to $5,046,000 from a loss of $3,086,000 year-over-year[11] - Net income attributable to Calavo Growers, Inc. was $4,415,000, compared to a net loss of $6,267,000 in the prior year[11] - Basic earnings per share for continuing operations was $0.25, a recovery from a loss of $0.15 in the same quarter last year[11] - For the three months ended January 31, 2025, total gross sales reached $156.051 million, a 20.3% increase from $129.657 million in the same period of 2024[23] - Net sales for the Fresh segment were $139.795 million, up from $113.026 million, reflecting a 23.6% growth year-over-year[23] - The net income attributable to Calavo Growers, Inc. for the three months ended January 31, 2025, was $4.415 million, compared to a net loss of $6.267 million in the same period of 2024[24] - Net income from continuing operations for the three months ended January 31, 2025, was $4.4 million, compared to a loss of $2.6 million for the same period in 2024[56] - Basic net income per share attributable to Calavo Growers, Inc. was $0.25 for the three months ended January 31, 2025, compared to a loss of $0.35 for the same period in 2024[56] Assets and Liabilities - Total current assets as of January 31, 2025, were $158,176,000, slightly down from $158,579,000 at the end of October 2024[10] - Cash and cash equivalents decreased to $48,490,000 from $57,031,000, reflecting a decrease of 15.4%[10] - Total liabilities decreased to $96,058,000 from $99,343,000, indicating a reduction of 3.0%[10] - As of January 31, 2025, total inventories increased to $39.873 million from $34.157 million as of October 31, 2024, representing a 16.5% rise[26] - The net carrying value of long-lived assets as of January 31, 2025, was $52.519 million, down from $54.200 million as of October 31, 2024[25] - As of January 31, 2025, total other assets were $49.791 million, slightly down from $49.916 million as of October 31, 2024[34] Cash Flow and Dividends - The company reported a net cash used in operating activities of $4,427,000 for the three months ended January 31, 2025, compared to a net cash provided of $58,000 in the same period last year[12] - The company declared a dividend of $0.10 per share, totaling $3.567 million for the current quarter[26] - The company paid a dividend of $0.20 per share, totaling $3.6 million, on January 31, 2025[35] Risks and Challenges - The company continues to face risks related to supply chain disruptions and market price volatility of agricultural products, which may impact future performance[6] - No material changes in market risk have been reported since the last annual report[128] Investments and Transactions - The investment in Don Memo increased to $3.3 million as of January 31, 2025, from $2.4 million as of October 31, 2024[29] - The company incurred $2.7 million and $3.0 million in cost of sales to Belher for the three months ended January 31, 2025, and 2024, respectively[32] - Avocados de Jalisco, approximately 83% owned by the company, purchased $0.2 million and $2.5 million of avocados from partners for the three months ended January 31, 2025, and 2024, respectively[33] - The Fresh Cut business was sold for $83 million, with a purchase price of $52.0 million for business assets and $31.0 million for real estate[68][69] - A goodwill impairment charge of $9.3 million was recorded in connection with the sale of the Fresh Cut business[64] Tax Matters - The company recorded a provision of $11 million related to the 2013 tax assessment in the third quarter of fiscal 2021[48] - CDM is in the process of filing Administrative Appeals for denied IVA refunds, indicating a proactive approach to tax recovery[62] - The company believes it has strong legal grounds to prevail in collecting the corresponding IVA amounts, supported by internationally recognized tax advisors[62] - The SAT refunded 13.7 million Mexican pesos (approximately $0.7 million USD) in VAT for March 2019, marking a significant milestone in the tax strategy[63]