Mission(AVO) - 2025 Q3 - Quarterly Results

Fiscal Third Quarter 2025 Financial Overview Mission Produce achieved record Q3 FY2025 revenue and gross profit, driven by effective Peruvian production and operational excellence CEO Message - The commercial team effectively programmed owned Peruvian production to strategically deliver fruit into multiple global regions, ensuring supply consistency and strong financial performance[3] - The vertically integrated model, combining a year-round sourcing network, owned production, global marketing, distribution, and value-add services, drives category leadership and global consumption[3] - Generated $34 million of operating cash flow during the third quarter, with expectations to build on this in Q4 as owned-crop inventory is sold[3] Key Financial Highlights Fiscal Third Quarter 2025 Key Financial Highlights | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | YoY Change | | :----- | :------------------- | :------------------- | :--------- | | Total Revenue | $357.7 | $324.0 | +10% | | Net Income | $14.7 | $12.4 | +18.5% | | Diluted EPS | $0.21 | $0.17 | +23.5% | | Adjusted Net Income | $18.2 | $16.7 | +8.9% | | Adjusted Diluted EPS | $0.26 | $0.23 | +13.0% | | Adjusted EBITDA | $32.6 | $31.5 | +3% | Consolidated Financial Review Mission Produce reported a 10% revenue increase and 22% gross profit increase for Q3 FY2025, driven by higher avocado volume Revenue and Gross Profit Analysis Revenue and Gross Profit (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | YoY Change | | :----- | :------------------- | :------------------- | :--------- | | Total Revenue | $357.7 | $324.0 | +10% | | Gross Profit | $45.1 | $37.0 | +22% | | Gross Profit Percentage | 12.6% | 11.4% | +120 bps | - Revenue increase was primarily driven by a 10% increase in avocado volume sold in the Marketing & Distribution segment, partially offset by a 5% decrease in average per-unit avocado sales prices[4] - Gross profit increase was driven by the International Farming segment due to significantly higher avocado production and increased yields[5] Operating Expenses and Net Income Operating Expenses and Net Income (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | YoY Change | | :----- | :------------------- | :------------------- | :--------- | | SG&A Expense | $24.1 | $20.2 | +19% | | Net Income | $14.7 | $12.4 | +18.5% | | Diluted EPS | $0.21 | $0.17 | +23.5% | - Selling, general and administrative (SG&A) expense increased primarily due to higher employee-related costs, including incentive and performance-based stock compensation, and higher statutory profit sharing in the International Farming segment[6] Adjusted Financial Metrics Adjusted Financial Metrics (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | YoY Change | | :----- | :------------------- | :------------------- | :--------- | | Adjusted Net Income | $18.2 | $16.7 | +8.9% | | Adjusted Diluted EPS | $0.26 | $0.23 | +13.0% | | Adjusted EBITDA | $32.6 | $31.5 | +3% | - Adjusted net income growth was driven by increased operating income, a $0.8 million reduction in interest expense, and a $0.3 million increase in equity method income[9] - Adjusted EBITDA increased primarily due to higher avocado production in the International Farming segment[10] Business Segment Performance Marketing & Distribution net sales rose 7% but adjusted EBITDA declined, while International Farming and Blueberries segments showed strong growth Marketing & Distribution Marketing & Distribution Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | YoY Change | | :----- | :------------------- | :------------------- | :--------- | | Net Sales | $344.1 | $321.3 | +7% | | Segment Adjusted EBITDA | $20.0 | $26.8 | -25.4% | - Segment adjusted EBITDA decline reflects the normalization of per-unit avocado gross margin, which had significantly exceeded historical averages in the prior year[12] International Farming International Farming Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | YoY Change | | :----- | :------------------- | :------------------- | :--------- | | Total Sales | $49.0 | $27.4 | +79% | | Segment Adjusted EBITDA | $12.1 | $4.6 | +163% | - Increases were driven by higher yield from owned avocado orchards and increased volume of avocado packing and cooling services provided to third parties[14] - Affiliated sales are concentrated in the second half of the fiscal year, aligning with the Peruvian avocado harvest season (April-September)[13] Blueberries Blueberries Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | YoY Change | | :----- | :------------------- | :------------------- | :--------- | | Net Sales | $4.5 | $1.6 | +181% | | Segment Adjusted EBITDA | $0.5 | $0.1 | +400% | - Net sales increase primarily due to higher volume produced on farms and higher average per-unit sales price[15] - Sales in the Blueberries segment are traditionally concentrated in the first and fourth quarters, aligning with the Peruvian blueberry harvest season[15] Balance Sheet and Cash Flow Cash and cash equivalents decreased, operating cash flow declined due to higher working capital, and capital expenditures rose Balance Sheet Overview Cash and Cash Equivalents | Metric | July 31, 2025 (Millions) | October 31, 2024 (Millions) | Change | | :----- | :----------------------- | :-------------------------- | :----- | | Cash and cash equivalents | $43.7 | $58.0 | -$14.3 | Cash Flow Activities Cash Flow Summary (9 Months Ended July 31) | Metric | 2025 (Millions) | 2024 (Millions) | Change | | :----- | :-------------- | :-------------- | :----- | | Net cash provided by operating activities | $21.4 | $55.4 | -$34.0 | | Capital expenditures | $39.8 | $25.3 | +$14.5 | - Higher working capital requirements in the current year were due to significantly higher avocado production and harvest timing in the International Farming segment, leading to increased inventory and lower payable balances[19] - Capital expenditures were primarily for pre-production orchard maintenance, land improvements, packhouse construction in Guatemala, and land development/blueberry plant cultivation in Peru[20] Outlook for Fiscal Year 2025 Fourth Quarter Q4 FY2025 anticipates higher avocado volumes with lower pricing, increased blueberry volumes, and capital expenditures of $50-$55 million - Avocado industry volumes are expected to be approximately 15% higher in Q4 FY2025 YoY, due to ample Peruvian product and a larger new Mexican crop[27] - Exported production from Mission's owned farms in Peru is expected to range between 105 million to 110 million pounds for the 2025 harvest season (up from 43 million pounds in 2024)[27] - Avocado pricing is expected to be lower by approximately 20-25% YoY in Q4 FY2025, correlated with higher available volumes[27] - Peruvian blueberry harvest will ramp up in Q4, with meaningful volume increases from owned farms likely offset by lower average sales prices[27] - Total capital expenditures for fiscal 2025 are expected to remain in the range of $50 to $55 million[27] Non-GAAP Financial Measures This section defines adjusted net income and adjusted EBITDA, non-GAAP measures used by management to analyze business results Definition of Adjusted Net Income - Adjusted net income (loss) is net income (loss) attributable to Mission Produce, adjusted for stock-based compensation, unrealized gains/losses on derivatives, foreign currency gains/losses, farming costs for nonproductive orchards, deferred ERP costs, transaction costs, amortization of inventory adjustments and intangible assets from business combinations, and other special, non-recurring, or one-time distortive items, including tax effects and noncontrolling interest impacts[24] Definition of Adjusted EBITDA - Adjusted EBITDA is net income (loss) before interest, taxes, depreciation, amortization, stock-based compensation, other income/expense, and equity method income/loss, further adjusted for asset impairment/disposals, farming costs for nonproductive orchards, deferred ERP costs, transaction costs, and other special, non-recurring, or one-time items, including noncontrolling interest impacts[25] - Effective Q4 2024, the reconciliation of adjusted EBITDA includes a subtotal for non-GAAP adjustments before the noncontrolling interest adjustment, called 'adjusted EBITDA before adjustment for noncontrolling interest,' to better align with management's review sequence[25] About Mission Produce, Inc. Mission Produce is a global leader in sourcing, producing, and distributing fresh Hass avocados and mangos globally - Mission Produce is a global leader in sourcing, producing, and distributing fresh Hass avocados and mangos to retail, wholesale, and foodservice customers in over 25 countries[1][27] - The company is vertically integrated, owning five state-of-the-art packing facilities across the U.S., Mexico, Peru, and Guatemala, and sourcing from 20+ premium growing regions for year-round supply[28] - Mission's global distribution network includes strategically positioned forward distribution centers offering value-added services like ripening, bagging, custom packing, and logistical management[28] Forward-Looking Statements & Contacts This section provides a standard disclaimer for forward-looking statements, outlining risks and uncertainties, and lists contacts Forward-Looking Statements - The press release contains forward-looking statements involving known and unknown risks and uncertainties, as defined by federal securities laws[29] - Actual results could differ materially due to factors such as reliance on one main product, supply limitations, market price fluctuations, increasing competition, international business risks, inflationary pressures, and inherent farming risks including climate change[29] Contacts - Investor Relations: Jeff Sonnek, ICR, 646-277-1263, jeff.sonnek@icrinc.com[30] - Media: Jenna Aguilera, Marketing Content and Communications Manager, Mission Produce, Inc., press@missionproduce.com[30] Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements for Mission Produce Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheets (Unaudited) | (In millions) | July 31, 2025 | October 31, 2024 | | :------------ | :------------ | :--------------- | | Total Assets | $1,002.4 | $971.5 | | Total Liabilities | $401.9 | $394.4 | | Total Equity | $600.5 | $577.1 | | Cash and cash equivalents | $43.7 | $58.0 | | Inventory | $103.4 | $91.2 | | Long-term debt, net of current portion | $128.5 | $110.7 | Condensed Consolidated Statements of Income Condensed Consolidated Statements of Income (Unaudited) | (In millions, except per share amounts) | Three Months Ended July 31, 2025 | Three Months Ended July 31, 2024 | Nine Months Ended July 31, 2025 | Nine Months Ended July 31, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net sales | $357.7 | $324.0 | $1,072.2 | $880.3 | | Gross profit | $45.1 | $37.0 | $105.0 | $96.7 | | Operating income | $21.0 | $16.8 | $37.2 | $37.1 | | Net income attributable to Mission Produce | $14.7 | $12.4 | $21.7 | $19.4 | | Diluted EPS | $0.21 | $0.17 | $0.30 | $0.27 | Condensed Consolidated Statements of Cash Flow Condensed Consolidated Statements of Cash Flow (Unaudited) | (In millions) | Nine Months Ended July 31, 2025 | Nine Months Ended July 31, 2024 | | :------------ | :------------------------------ | :------------------------------ | | Net cash provided by operating activities | $21.4 | $55.4 | | Net cash used in investing activities | $(40.0) | $(26.0) | | Net cash provided by (used in) financing activities | $5.8 | $(22.9) | | Net (decrease) increase in cash, cash equivalents and restricted cash | $(12.7) | $6.7 | | Cash, cash equivalents and restricted cash, end of period | $46.6 | $49.9 | Reconciliation of Non-GAAP Financial Measures to GAAP (Unaudited) This section provides detailed reconciliations of non-GAAP financial measures, Adjusted Net Income and Adjusted EBITDA, to their GAAP equivalents Adjusted Net Income Reconciliation Adjusted Net Income Reconciliation (Unaudited) | (In millions, except per share amounts) | Three Months Ended July 31, 2025 | Three Months Ended July 31, 2024 | Nine Months Ended July 31, 2025 | Nine Months Ended July 31, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net income attributable to Mission Produce | $14.7 | $12.4 | $21.7 | $19.4 | | Stock-based compensation | $1.7 | $1.5 | $5.6 | $4.5 | | Foreign currency transaction (gain) loss | $1.2 | $(1.2) | $1.4 | $0.1 | | Mission Produce adjusted net income | $18.2 | $16.7 | $34.0 | $33.2 | | Mission Produce adjusted net income per diluted share | $0.26 | $0.23 | $0.48 | $0.47 | Adjusted EBITDA Reconciliation Adjusted EBITDA Reconciliation (Unaudited) | (In millions) | Three Months Ended July 31, 2025 | Three Months Ended July 31, 2024 | Nine Months Ended July 31, 2025 | Nine Months Ended July 31, 2024 | | :------------ | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net income | $14.5 | $12.1 | $23.7 | $21.1 | | Interest expense | $2.4 | $3.2 | $7.1 | $9.9 | | Provision for income taxes | $5.3 | $4.5 | $10.2 | $10.0 | | Depreciation and amortization | $8.4 | $8.9 | $24.1 | $27.5 | | Stock-based compensation | $1.7 | $1.5 | $5.6 | $4.5 | | Total adjusted EBITDA | $32.6 | $31.5 | $69.4 | $70.9 | Other Information (Unaudited) This section provides supplementary unaudited financial data, including segment sales, avocado sales volume and pricing, and total net sales Segment Sales Segment Sales (Unaudited) | (In millions) | Marketing & Distribution (Q3 2025) | International Farming (Q3 2025) | Blueberries (Q3 2025) | Total (Q3 2025) | Marketing & Distribution (Q3 2024) | International Farming (Q3 2024) | Blueberries (Q3 2024) | Total (Q3 2024) | | :------------ | :--------------------------------- | :------------------------------ | :-------------------- | :-------------- | :--------------------------------- | :------------------------------ | :-------------------- | :-------------- | | Third party sales | $344.1 | $9.1 | $4.5 | $357.7 | $321.3 | $1.1 | $1.6 | $324.0 | | Affiliated sales | — | $39.9 | — | $39.9 | — | $26.3 | — | $26.3 | | Total segment sales | $344.1 | $49.0 | $4.5 | $397.6 | $321.3 | $27.4 | $1.6 | $350.3 | | Intercompany eliminations | — | $(39.9) | — | $(39.9) | — | $(26.3) | — | $(26.3) | | Total net sales | $344.1 | $9.1 | $4.5 | $357.7 | $321.3 | $1.1 | $1.6 | $324.0 | Avocado Sales Avocado Sales (Unaudited) | Metric | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | | :----- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Pounds of avocados sold (millions) | 183.5 | 166.1 | 509.8 | 486.2 | | Average sales price per pound | $1.74 | $1.84 | $1.83 | $1.62 | Sales by Type Sales by Type (Unaudited) | (In millions) | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | | :------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Avocado | $327.0 | $306.9 | $938.8 | $786.7 | | Other | $30.7 | $17.1 | $133.4 | $93.6 | | Total net sales | $357.7 | $324.0 | $1,072.2 | $880.3 |