Calavo(CVGW) - 2025 Q3 - Quarterly Report

FORWARD-LOOKING STATEMENTS This section outlines that the Form 10-Q contains forward-looking statements, subject to risks and uncertainties that could cause actual results to differ materially - The report contains forward-looking statements subject to risks, uncertainties, and assumptions, based on current expectations and not guarantees of future performance[5] - Factors that may cause actual results to differ materially include projections of revenue, gross profit, expenses, and earnings per share, impact of acquisitions, macroeconomic trends, legal matters, and supply chain disruptions[8] - The company does not undertake any obligation to update or revise forward-looking statements, except as required by applicable securities laws[7] PART I. FINANCIAL INFORMATION Item 1. Financial Statements This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, cash flows, and shareholders' equity, with detailed explanatory notes Condensed Consolidated Balance Sheets The company's total assets remained stable at $301.2 million as of July 31, 2025, compared to $301.1 million at October 31, 2024, with improved working capital and increased shareholders' equity | Metric | July 31, 2025 | October 31, 2024 | Change (2025 vs 2024) | | :-------------------------------- | :------------ | :--------------- | :-------------------- | | Assets | | | | | Cash and cash equivalents | $63,754 | $57,031 | +$6,723 | | Total current assets | $159,112 | $158,579 | +$533 | | Property, plant, and equipment, net | $50,603 | $54,200 | -$3,597 | | Total assets | $301,249 | $301,119 | +$130 | | Liabilities | | | | | Payable to growers | $31,849 | $18,377 | +$13,472 | | Accrued expenses | $10,459 | $28,149 | -$17,690 | | Income tax payable | $1,721 | $2,767 | -$1,046 | | Total current liabilities | $69,201 | $73,205 | -$4,004 | | Total long-term liabilities | $24,048 | $26,138 | -$2,090 | | Shareholders' Equity | | | | | Total shareholders' equity | $208,000 | $201,776 | +$6,224 | Condensed Consolidated Statements of Operations For the three months ended July 31, 2025, net sales remained stable, but gross profit and operating income decreased, while net income significantly improved due to the absence of discontinued operations, and for the nine months, net sales, gross profit, and net income all showed positive growth | Metric | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :------------------------------------------ | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Net sales | $178,822 | $179,596 | -0.4% | $523,753 | $491,585 | +6.5% | | Gross profit | $18,198 | $20,093 | -9.4% | $52,015 | $51,514 | +1.0% | | Operating income | $8,659 | $9,358 | -7.5% | $21,335 | $13,711 | +55.6% | | Net income (loss) from discontinued operations | — | $(6,127) | N/A | — | $(10,218) | N/A | | Net income (loss) attributable to Calavo Growers, Inc. | $4,714 | $(732) | N/A | $15,979 | $(937) | N/A | | Basic EPS (Continuing Operations) | $0.26 | $0.30 | -13.3% | $0.90 | $0.52 | +73.1% | | Basic EPS (Net income (loss)) | $0.26 | $(0.04) | N/A | $0.90 | $(0.05) | N/A | Condensed Consolidated Statements of Cash Flows For the nine months ended July 31, 2025, net cash provided by operating activities increased significantly to $19.2 million, while cash used in investing activities decreased and financing activities remained stable | Metric | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :-------------------------------------- | :--------------------------- | :--------------------------- | :----------- | | Net income (loss) | $16,111 | $(920) | N/A | | Net cash provided by operating activities | $19,234 | $13,583 | +41.6% | | Net cash used in investing activities | $(1,066) | $(2,519) | -57.7% | | Net cash (used in) financing activities | $(11,445) | $(12,790) | -10.5% | | Net increase (decrease) in cash | $6,723 | $(1,726) | N/A | | Cash, cash equivalents, end of period | $63,754 | $1,126 | +5576.2% | Condensed Consolidated Statements of Shareholders' Equity Total shareholders' equity increased to $208.0 million by July 31, 2025, driven by net income, partially offset by dividend payments | Metric | Balance, October 31, 2024 | Balance, July 31, 2025 | Change | | :-------------------------------------- | :------------------------ | :--------------------- | :------- | | Common Stock (Amount) | $18 | $18 | $0 | | Additional Paid-in Capital | $177,973 | $178,803 | +$830 | | Retained Earnings | $22,341 | $27,603 | +$5,262 | | Noncontrolling Interest | $1,444 | $1,576 | +$132 | | Total Shareholders' Equity | $201,776 | $208,000 | +$6,224 | - Net income attributable to Calavo Growers, Inc. for the nine months ended July 31, 2025, was $15,979 thousand, contributing significantly to the increase in retained earnings[15] - Dividends declared to shareholders for the nine months ended July 31, 2025, totaled $10,717 thousand[15] Notes to Condensed Consolidated Financial Statements This section provides detailed disclosures on business operations, segment reporting, inventory, related party transactions, significant events, and tax matters 1. Description of the business Calavo Growers, Inc. is a global leader in sourcing, packing, and distributing fresh avocados, tomatoes, papayas, and processing guacamole and other avocado products - Calavo is a global leader in fresh avocados, tomatoes, papayas, and processed avocado products (guacamole)[17] - The "Grown" segment was renamed "Fresh" in Q1 fiscal 2025 to better reflect activities, with no change to its composition or financial results[18] 2. Information regarding our operations in different segments Calavo operates in Fresh and Prepared segments, with Fresh sales increasing 6.2% and Prepared sales increasing 10.0% for the nine months ended July 31, 2025 - The "Grown" segment was renamed "Fresh" in Q1 fiscal 2025, comprising fresh avocados, tomatoes, and papayas, while the "Prepared" segment includes guacamole and avocado pulp[23] Net Sales by Segment | Segment | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :------ | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Fresh | $155,851 | $163,218 | -4.5% | $470,307 | $442,999 | +6.2% | | Prepared | $22,971 | $16,378 | +40.2% | $53,446 | $48,586 | +10.0% | | Total | $178,822 | $179,596 | -0.4% | $523,753 | $491,585 | +6.5% | Gross Profit by Segment | Segment | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :------ | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Fresh | $12,427 | $18,175 | -31.6% | $38,617 | $40,958 | -5.7% | | Prepared | $5,771 | $1,918 | +200.9% | $13,398 | $10,556 | +26.9% | | Total | $18,198 | $20,093 | -9.4% | $52,015 | $51,514 | +1.0% | 3. Inventories Total inventories decreased to $30.3 million by July 31, 2025, with a significant increase in inventory reserves due to slow-moving items and market factors | Inventory Type | July 31, 2025 | October 31, 2024 | Change | | :---------------------- | :------------ | :--------------- | :----- | | Fresh fruit | $16,233 | $20,002 | -$3,769 | | Packing supplies and ingredients | $6,932 | $6,936 | -$4 | | Finished prepared foods | $7,163 | $7,219 | -$56 | | Total | $30,328 | $34,157 | -$3,829 | - Inventory reserves increased to $2.6 million as of July 31, 2025, from $0.4 million at October 31, 2024, reflecting higher slow-moving inventories and market factors, including the FDA detention hold on Mexican avocados[26][27] 4. Related party transactions Calavo engages in various related party transactions, including avocado procurement from affiliated entities and advances with unconsolidated entities - Avocados procured from entities owned or controlled by Board members totaled $2.7 million (3 months) and $4.3 million (9 months) for July 31, 2025[28] - Avocados procured from entities affiliated with the CEO totaled $2.5 million (3 months) and $6 million (9 months) for July 31, 2025[29] - Calavo has a 50% ownership in Agricola Don Memo, with outstanding advances of $8.2 million as of July 31, 2025, and incurred $10.6 million in cost of sales for the nine months ended July 31, 2025[31] - Calavo had grower advances due from Belher totaling $4.3 million as of July 31, 2025, and incurred $16 million in cost of sales for the nine months ended July 31, 2025[32][34] - Avocados de Jalisco, 83% owned by Calavo, purchased approximately $3 million of avocados from its partners for the nine months ended July 31, 2025[35] 5. Other assets Other assets primarily consist of Mexican IVA taxes receivable, net, which increased to $53.9 million as of July 31, 2025 | Asset Type | July 31, 2025 | October 31, 2024 | Change | | :-------------------------------------- | :------------ | :--------------- | :----- | | Mexican IVA taxes receivable, net | $53,854 | $48,739 | +$5,115 | | Infrastructure advances | — | $467 | -$467 | | Other | $581 | $710 | -$129 | | Total | $54,435 | $49,916 | +$4,519 | 6. Other events This note details significant events including quarterly dividends, an FDA detention hold, FCPA inquiry closure, new tax law, ongoing Mexican tax litigation, and a lease contingency - Calavo paid quarterly dividends of $0.20 per share on January 31, April 29, and July 28, 2025, each totaling $3.6 million, with another $0.20 dividend declared for October 31, 2025[37] - In July 2025, the FDA placed Calavo de México (CDM) on a Red List Detention Hold due to trace levels of Imazalil, resulting in approximately $4.2 million in incremental costs (inspection, logistics, inventory write-downs), which was resolved in September 2025[38] - The U.S. Department of Justice closed its Foreign Corrupt Practices Act (FCPA) inquiry related to Mexican operations on September 2, 2025[43] - The One Big Beautiful Bill Act (OBBBA) was enacted in July 2025, affecting corporate taxation, but its impacts did not materially affect the tax rate for the three and nine months ended July 31, 2025[44] - Calavo is appealing a 2013 Mexican tax assessment totaling approximately $160 million USD (including inflation and fines) and a $6.3 million employee profit-sharing liability, with a provision of $11 million recorded in Q3 fiscal 2021 for this matter[47][52] - As a guarantor for assigned leases from the Fresh Cut business sale, Calavo has a maximum exposure of $32.0 million in undiscounted future minimum lease payments, plus $13.3 million in potential additional payments[54][58] 7. Noncontrolling interest Noncontrolling interest, primarily related to Avocados de Jalisco, increased to $1.576 million by July 31, 2025, reflecting net income attribution | 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 | | :---------------------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Noncontrolling interest, beginning | $1,554 | $1,439 | $1,444 | $1,392 | | Net income (loss) attributable to noncontrolling interest | $22 | $(30) | $132 | $17 | | Noncontrolling interest, ending | $1,576 | $1,409 | $1,576 | $1,409 | 8. Earnings per share Basic and diluted EPS from continuing operations for the nine months ended July 31, 2025, increased significantly to $0.90 from $0.52 | 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 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net income from continuing operations attributable to Calavo Growers, Inc. (Numerator) | $4,714 | $5,395 | $15,979 | $9,281 | | Weighted average shares - Basic (Denominator) | 17,853 | 17,801 | 17,842 | 17,800 | | Effect on dilutive securities – Restricted stock/units/options | 46 | 41 | 51 | 48 | | Basic EPS (Continuing Operations) | $0.26 | $0.30 | $0.90 | $0.52 | | Diluted EPS (Continuing Operations) | $0.26 | $0.30 | $0.89 | $0.52 | | Basic EPS (Net income (loss)) | $0.26 | $(0.04) | $0.90 | $(0.05) | | Diluted EPS (Net income (loss)) | $0.26 | $(0.04) | $0.89 | $(0.05) | 9. Mexican IVA taxes receivable Mexican IVA taxes receivable, net, increased to $53.9 million, with ongoing efforts to recover VAT amounts and a recent favorable court ruling under appeal - CDM VAT receivables, net of provision, totaled $53.9 million (1.0 billion Mexican pesos) as of July 31, 2025, up from $48.7 million (976.0 million Mexican pesos) at October 31, 2024[64] - In Q2 fiscal 2025, the SAT refunded 36.7 million Mexican pesos (approx. $1.9 million USD) in VAT relating to claims for March, April, and November 2019, secured directly from the tax authority[68] - In August 2025, the Fifth Collegiate Circuit Court ruled in favor of CDM, recognizing it as a maquila and directing the SAT to refund IVA balances for January-June 2013, though the SAT has appealed this to the Mexican Supreme Court[69] 10. Assets Held for Sale and Discontinued Operations The Fresh Cut business was sold in August 2024 for $83 million, resulting in a goodwill impairment charge and a net loss from discontinued operations - The Fresh Cut business was sold in August 2024 for $83 million and was classified as discontinued operations[70][75] - A $9.3 million goodwill impairment charge was recorded in Q3 fiscal 2024 in connection with the sale[71] Discontinued Operations Financial Summary | Metric | 3 Months Ended July 31, 2024 | 9 Months Ended July 31, 2024 | | :-------------------------------------- | :--------------------------- | :--------------------------- | | Net sales | $88,586 | $258,958 | | Gross profit | $7,362 | $12,003 | | Operating loss | $(6,111) | $(10,173) | | Net loss from discontinued operations | $(6,127) | $(10,218) | 11. Sale of Fresh Cut Business The Fresh Cut business was sold for $83 million in August 2024, leading to an amendment of the company's credit agreement - The Fresh Cut business and related real estate were sold for a total transaction value of $83 million on August 15, 2024[75] - The sale included $52.0 million for business assets and $31.0 million for real estate[76] - The credit agreement was amended to reduce revolving commitments from $90.0 million to $75.0 million, aligning with the asset base excluding the Fresh Cut business[77] 12. Subsequent Events Subsequent events include a favorable court ruling on IVA refunds (under appeal) and the declaration of a $0.20 per share quarterly cash dividend - In August 2025, the Fifth Collegiate Circuit Court ruled recognizing CDM as a maquila and directing the SAT to refund IVA balances for January-June 2013, though the SAT appealed this decision[78] - A quarterly cash dividend of $0.20 per share was declared, payable on October 31, 2025, to shareholders of record on September 30, 2025[79] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on financial performance, liquidity, and capital resources, highlighting recent developments, market trends, and operational results Recent Developments Recent developments include quarterly dividends, closure of the FCPA inquiry, and positive progress in Mexican tax matters with a VAT refund and favorable court ruling - A quarterly cash dividend of $0.20 per share was paid on July 28, 2025, and another declared for October 31, 2025[81] - The U.S. Department of Justice closed its Foreign Corrupt Practices Act (FCPA) inquiry related to Calavo's Mexican operations on September 2, 2025[82] - Calavo received a $1.9 million VAT refund from the SAT in Q2 fiscal 2025 and a favorable August 2025 court ruling recognizing CDM as a maquila for IVA refunds, which the SAT has appealed[83][84] Market Trends and Uncertainties Calavo faces macroeconomic challenges, a temporary FDA detention hold, ongoing U.S.-Mexico trade policy uncertainty, and supply chain disruption risks - Macroeconomic challenges, including inflationary pressures and shifts in trade policies, continue to affect operations, driving cost fluctuations in fruit, labor, packaging, and operating expenses[85][86] - A temporary FDA detention hold on Calavo de México (CDM) in July 2025, due to trace Imazalil, resulted in approximately $4.2 million in incremental costs (inspection, logistics, inventory write-downs), though the hold was lifted in September 2025[87] - Ongoing uncertainty in U.S. trade policy with Mexico, including potential tariffs (e.g., 25% on imports, briefly in effect March 2025) and the termination of the U.S.–Mexico Tomato Suspension Agreement (imposing a 17% anti-dumping duty), could raise input costs and disrupt supply chains[89][90][92] - A temporary pause in operations at a Mexican packinghouse in Q1 fiscal 2025 due to avocado weevils, though resolved, highlights ongoing supply chain disruption risks from pests or phytosanitary issues[94][95][96] Critical Accounting Estimates No material changes occurred in Calavo's critical accounting estimates during the three and nine months ended July 31, 2025 - No material changes in critical accounting estimates for the three and nine months ended July 31, 2025[99] Results of Operations Calavo's nine-month results show increased net sales and gross profit, driven by higher avocado pricing and Prepared segment growth, alongside reduced SG&A expenses Net Sales For the nine months, net sales grew 7% to $523.8 million, driven by higher avocado pricing in Fresh and increased volumes in Prepared, despite a slight decline in the three-month period Net Sales by Segment | Segment | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :------ | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Fresh | $155,851 | $163,218 | -4.5% | $470,307 | $442,999 | +6.2% | | Prepared | $22,971 | $16,378 | +40.2% | $53,446 | $48,586 | +10.0% | | Total | $178,822 | $179,596 | -0.4% | $523,753 | $491,585 | +6.5% | - For the three months, Fresh avocado sales decreased 3% due to a 5% volume decline, partially offset by a 2% price increase, while tomato sales decreased 40% due to a 27% volume decline and 18% price decrease, impacted by the termination of the Tomato Suspension Agreement[107] - For the nine months, Fresh avocado sales increased 12% due to a 22% price increase, partially offset by a 9% volume decline, while tomato sales decreased 37% due to a 34% volume decline and 6% price decrease, impacted by adverse weather and abundant domestic supply[107] - Prepared segment sales increased 40% (3 months) and 10% (9 months) primarily due to increased pounds sold (35% and 11% respectively), expanded sales to existing customers, and new customer wins[107][110] Gross Profit Consolidated gross profit decreased 9% for the three months due to FDA detention costs, but increased 1% for the nine months, driven by Prepared segment growth Gross Profit by Segment | Segment | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :------ | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Fresh | $12,427 | $18,175 | -31.6% | $38,617 | $40,958 | -5.7% | | Prepared | $5,771 | $1,918 | +200.9% | $13,398 | $10,556 | +26.9% | | Total | $18,198 | $20,093 | -9.4% | $52,015 | $51,514 | +1.0% | - The $4.2 million in discrete costs associated with the FDA detention hold on Mexican avocados significantly impacted Q3 2025 gross profit, recorded in cost of sales[113] - Fresh segment gross profit decreased due to lower avocado and tomato volumes and regulatory costs (FDA detention, temporary tariff event)[115][116][119] - Prepared segment gross profit increased due to higher sales volumes, lower fruit input costs, and improved operating efficiencies[114][117] Selling, General and Administrative SG&A expenses decreased by 12% for the three months and 19% for the nine months, primarily due to reduced professional, consulting, and compensation expenses Selling, General and Administrative Expenses | Metric | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :-------------------------------------- | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Selling, general and administrative | $9,232 | $10,510 | -12.2% | $29,822 | $36,993 | -19.4% | | Percentage of net sales | 5% | 6% | -1% | 6% | 8% | -2% | - The decrease in SG&A was driven by a $2.0 million reduction in professional and consulting fees (including lower FCPA-related legal expenses) for the three months, and a $5.1 million reduction for the nine months, along with lower compensation and stock-based compensation expenses[120][121] Foreign currency loss Foreign currency remeasurement losses decreased by 41% for the three months and 11% for the nine months, reflecting Mexican peso exchange rate fluctuations Foreign Currency Loss | Metric | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :-------------------- | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Foreign currency loss | $(2,483) | $(4,203) | -41.0% | $(2,488) | $(2,799) | -11.1% | Income (loss) from unconsolidated entities Income from unconsolidated entities improved significantly, moving from a loss to income for the nine months ended July 31, 2025 Income (Loss) from Unconsolidated Entities | Metric | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :-------------------------------------- | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Income (loss) from unconsolidated entities | $(402) | $(579) | -30.6% | $178 | $(374) | +147.6% | Income tax benefit (expense) The company recorded an income tax expense of $1.8 million for the three months and $5.6 million for the nine months, with an effective tax rate of 26% Income Tax Benefit (Expense) | Metric | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | Change (YoY) | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | Change (YoY) | | :---------------------------- | :--------------------------- | :--------------------------- | :----------- | :--------------------------- | :--------------------------- | :----------- | | Income tax benefit (expense) | $(1,807) | $1,441 | -225.4% | $(5,598) | $478 | -1271.1% | | Effective tax rate | 26% | -37% | N/A | 26% | -5% | N/A | - The effective tax rate for both periods in 2025 was 26%, differing from the U.S. federal statutory rate of 21% due to U.S. state tax and foreign tax rate differentials in Mexico[125] Liquidity and Capital Resources Cash provided by operating activities increased to $19.2 million, with strong liquidity maintained through cash and cash equivalents, an amended credit facility, and a stock repurchase program - Cash provided by operating activities was $19.2 million for the nine months ended July 31, 2025, up from $13.6 million in the prior year[127] - Cash and cash equivalents totaled $63.8 million as of July 31, 2025, and working capital was $89.9 million, up from $57.0 million and $85.4 million, respectively, at October 31, 2024[132] - The revolving credit facility was amended to $75.0 million (from $90.0 million) in August 2024, with approximately $50.5 million available for borrowing as of July 31, 2025, at a weighted-average interest rate of 8.0%[135][139] - A stock repurchase program of up to $25 million was authorized in March 2025, though no shares have been repurchased to date[140] Contractual Commitments No material changes have occurred in Calavo's contractual commitments since the prior fiscal year's Annual Report on Form 10-K - No material changes to contractual commitments since the last Annual Report on Form 10-K[141] Item 3. Quantitative and Qualitative Disclosures About Market Risk No material changes in market risk disclosures have occurred since the Annual Report on Form 10-K for the year ended October 31, 2024 - No material changes in market risk disclosures[142] Item 4. Controls and Procedures Calavo's disclosure controls and procedures were effective as of July 31, 2025, with no material changes in internal control over financial reporting during the quarter - Disclosure controls and procedures were effective as of July 31, 2025[143] - No material changes in internal control over financial reporting during the quarter ended July 31, 2025[144] PART II. OTHER INFORMATION Item 1. Legal Proceedings Information regarding legal proceedings is referenced in Note 6 to the unaudited condensed consolidated financial statements - Legal proceedings information is detailed in Note 6 of the financial statements[146] Item 1A. Risk Factors No material changes to the risk factors have been disclosed since the Annual Report on Form 10-K for fiscal year ended October 31, 2024 - No material changes to risk factors from previous filings[148] Item 5. Other Information This section confirms no new Rule 10b5-1 trading arrangements and provides an update on cybersecurity governance and program enhancements Trading Plans No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter ended July 31, 2025 - No new Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted or terminated by directors or officers[150] Supplemental Cybersecurity Governance and Program Update The Board of Directors provides direct oversight of cybersecurity risk, with an ongoing NIST Framework evaluation and systematic program enhancement initiative - The Board of Directors provides direct oversight of cybersecurity risk, supported by directors with relevant experience[151] - An ongoing evaluation against the NIST Cybersecurity Framework 2.0 is expected to be completed in Q4 2025, indicating the residual risk profile is within acceptable parameters[152] - A twelve-month systematic program enhancement initiative has been launched to elevate cybersecurity program maturity through structured documentation, policy refinement, and capability advancement[153] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL documents for financial data - Includes certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[154] - Contains Inline XBRL documents for the consolidated financial statements and other financial information[156][157] Signatures The report is duly signed on behalf of Calavo Growers, Inc. by the Chief Executive Officer and Chief Financial Officer on September 9, 2025 - The report was signed by Lecil E. Cole (CEO) and James Snyder (CFO) on September 9, 2025[160]