Calavo(US:CVGW)2024-03-10 16:00Financial Performance - Total net sales for Q1 2024 were $127.6 million, a decline of 3.9% from $132.8 million in Q1 2023[6] - Net loss for Q1 2024 was $2.6 million, or $0.15 per diluted share, compared to a net loss of $0.7 million, or $0.04 per diluted share in the same period last year[7] - Adjusted EBITDA for Q1 2024 was $4.8 million, an increase from $4.6 million in the prior year quarter[15] - Grown segment sales decreased 4.0% to $113.0 million, while Prepared segment sales decreased 2.9% to $14.6 million[12] - Gross profit for Q1 2024 was $12.5 million, or 9.8% of net sales, compared to $13.1 million, or 9.9% of net sales in the prior year[33] - The operating loss for the three months ended January 31, 2024, was $(1.378) million compared to an operating loss of $(0.605) million in the prior year[43] - Adjusted net loss from continuing operations was $(2.574) million, compared to a net loss of $(0.445) million in the same period last year[43] - The company reported a net loss attributable to Calavo Growers, Inc. of $(6.267) million for the three months ended January 31, 2024, compared to $(3.068) million in the prior year[43] Expenses and Costs - Selling, general and administrative (SG&A) expenses for Q1 totaled $13.5 million, or 10.6% of net sales, up from $11.6 million, or 8.8% of net sales in the same period last year[14] - The company anticipates SG&A savings of $20 million or more on an annualized basis following the divestiture of the fresh cut business[13] - Depreciation and amortization expenses increased to $2.032 million in Q1 2024 from $1.954 million in Q1 2023[49] - Interest expense rose to $0.824 million in Q1 2024, compared to $0.377 million in Q1 2023[49] - Stock-based compensation decreased to $0.892 million in Q1 2024 from $1.192 million in Q1 2023[49] - Professional fees related to the FCPA Mexico investigation amounted to $2.380 million in Q1 2024[49] - Restructuring costs related to consulting and management recruiting and severance were $0.417 million in Q1 2024, up from $0.203 million in Q1 2023[49] - The company incurred $0.2 million in professional fees related to Mexican tax matters in Q1 2024, down from $0.6 million in Q1 2023[47] - A reserve of $0.2 million was recognized for the collectability of IVA receivables in Q1 2024, compared to $1.4 million in Q1 2023[47] Balance Sheet and Liquidity - The company ended the quarter with $47.0 million of net debt, including $45.7 million of borrowings under its credit facility[8] - Current assets increased significantly to $245.597 million as of January 31, 2024, from $133.370 million as of October 31, 2023[42] - Total current liabilities rose to $120.895 million from $81.746 million, indicating increased financial obligations[42] - Cash and cash equivalents increased to $5.658 million from $2.091 million, reflecting improved liquidity[42] - The company’s total shareholders' equity decreased to $202.533 million from $210.229 million, indicating a decline in net worth[42] Future Outlook - The company expects a solid rebound in earnings in Q2 2024 due to improved avocado margins and the ramp-up of the California avocado season[32] - The company is facing risks related to operational and restructuring initiatives, supply chain disruptions, and market price sensitivity for avocados and other agricultural products[39] Segment Performance - The average selling price of avocados in the Grown segment increased by 20% compared to the prior year[6] - Adjusted EBITDA from continuing operations for the three months ended January 31, 2024, was $4.791 million, an increase from $4.586 million in the same period of 2023[49]