Mission Produce, Inc. (Nasdaq: AVO) (“Mission” or the “Company”), a
world leader in sourcing, producing, and distributing fresh Hass
avocados with additional offerings in mangos and blueberries, today
reported its financial results for the fiscal fourth quarter ended
October 31, 2023.
Fiscal Fourth
Quarter 2023 Financial
Overview:
- Total revenue
increased 8% to $257.9 million compared to the same period last
year driven by a 8% increase in average per-unit avocado selling
prices, partially offset by a 4% decrease in avocado volume
sold
- Net income of $4.0
million, or $0.06 per diluted share, compared to net loss of
$(42.0) million, or $(0.59) per diluted share, for the same period
last year, which included a non-cash charge of $49.5 million
related to goodwill impairment
- Adjusted net
income of $7.5 million, or $0.11 per diluted share, compared to
$9.2 million, or $0.13 per diluted share, for the same period last
year
- Adjusted EBITDA of
$17.3 million, compared to $17.2 million in the period year
period
Full Year 2023 Financial
Overview:
- Total avocado
volume sold increased by 12% to 654.4 million pounds
- Total revenue was
$953.9 million compared to $1.05 billion last year; despite volume
growth as a result of lower average per-unit avocado sales prices;
lower pricing and higher avocado volume sold in the current year
were driven by higher industry supply out of Mexico in the current
year after experiencing supply limitations in the previous fiscal
year
- Net loss of $(2.8)
million, or $(0.04) per diluted share, compared to $(34.6) million,
or $(0.49) per diluted share last year
- Adjusted net
income of $13.3 million, or $0.19 per diluted share, compared to
$18.5 million, or $0.26 per diluted share last year
- Adjusted EBITDA
increased 2% to $48.4 million compared to $47.6 million last
year
- Owned exportable
avocado production volume decreased 9% to 107 million pounds for
the 2023 harvest season; volume was negatively impacted by
weather-related events in the current year
CEO
Message
Steve Barnard, CEO of Mission, commented, “Our
fourth quarter results saw improved top and bottom-line performance
driven by strength in our Marketing and Distribution segment,
further supported by substantial growth in our emerging Blueberries
segment. However, continued weather-related challenges in Peru
resulted in quality issues towards the latter end of the season and
lower than expected volumes, both of which impacted our
International Farming segment performance. Because we
set our fixed price contracts with customers and market allocation
prior to experiencing these weather-related events, we were limited
in our ability to generate the seasonal increase in adjusted EBITDA
that we would typically expect in the fourth quarter.”
Mr. Barnard continued, “Looking ahead to 2024,
we expect to realize improved pricing in our International Farming
segment given adjustments we’ve made to our marketing strategy
following this past year’s experience, which we believe will create
a more constructive backdrop for our International Farming segment
performance next year. In the meantime, we remain intensely focused
on advancing cost control measures and reallocating resources to
maximize efficiency. We believe that with anticipated improvements
in operating cash flow and declining capital expenditure needs, we
are in a great position to enhance our capital structure in the
year ahead. We continue to focus our organization’s efforts on
supporting long-term consumption growth trends globally and
providing the market with consistent year-round supply of avocados
on a global scale— a capability that is unique to Mission Produce.
We are also excited about accelerating and advancing our burgeoning
mango program and seeing the continued success of our Blueberries
segment.”
Fiscal Fourth
Quarter 2023 Consolidated
Financial Review
Total revenue for the fourth quarter of fiscal
2023 increased $19.9 million or 8% compared to the same period last
year driven primarily by higher average per-unit avocado sales
prices, partially offset by lower avocado volume sold. Revenue
growth was further supported by strong performance in the Company’s
Blueberries segment, which increased by 88%.
Gross profit increased $0.9 million in the
fourth quarter of fiscal 2023 compared to the same period last
year, to $27.8 million and gross profit percentage decreased 50
basis points, to 10.8% of revenue. The Company’s Marketing &
Distribution segment experienced 49% growth in gross profit versus
the same period last year driven by strong per-unit margins on
Mexican and Californian avocados. Gross profit also benefited from
higher volumes and elevated pricing within the Blueberries segment.
On the contrary, the International Farming segment experienced a
significant decline in gross profit due to lower volume and lower
pricing on avocados sold from Company-owned farms. The lower volume
and pricing conditions were driven by quality issues and a
compressed Peruvian harvest season that was brought about by El
Niño-related weather events.
Selling, general and administrative expense
(“SG&A”) for the fourth quarter increased $1.1 million or 6%
compared to the same period last year primarily due to $1.3 million
in executive severance charges, a $0.3 million increase in
stock-based compensation, and additional labor to support the
developing U.K. business. Excluding these items, the Company made
progress on its goal to reduce controllable expenses during the
fourth quarter.
Net income for the fourth quarter of fiscal 2023
was $4.0 million, or $0.06 per diluted share, compared to net loss
of $(42.0) million, or $(0.59) per diluted share, for the same
period last year, which included a non-cash charge of $49.5 million
related to goodwill impairment within the International Farming
segment. Non-operating items also contributed to the year-over-year
change in net income and included higher interest expense in the
current quarter associated with rising interest rates.
Adjusted net income for the fourth quarter of
fiscal 2023 was $7.5 million, or $0.11 per diluted share, compared
to $9.2 million, or $0.13 per diluted share, for the same period
last year.
Adjusted EBITDA was $17.3 million for the fourth
quarter of fiscal 2023, a 1% increase compared to $17.2 million in
the period year period, as stronger gross profit performance from
the Marketing & Distribution and Blueberries segments was
largely offset by lower volumes and pricing within the
International Farming segment.
Fiscal Fourth
Quarter Business Segment Performance
Marketing & Distribution
Net sales in the Marketing & Distribution
segment increased 7% to $236.2 million for the quarter, due to an
8% increase in average per-unit avocado sales prices, partially
offset by a 4% decrease in avocado volume sold.
Segment adjusted EBITDA increased $6.8 million
or 170% to $10.8 million, primarily due to the impact of higher
per-unit gross margins, partially offset by lower avocado volume
sold.
International Farming
The vast majority of fruit sales from the
International Farming segment are to the Marketing and Distribution
segment, with the remainder of revenue largely derived from
services provided to third parties and the Blueberries segment.
Affiliated sales are concentrated in the second half of the fiscal
year in alignment with the Peruvian avocado harvest season, which
typically runs from April through September of each year. As a
result, adjusted EBITDA for the International Farming segment is
generally concentrated in the third and fourth quarters of the
fiscal year in alignment with the timing of sales.
Total segment sales in the International Farming
segment increased by 1% in the fourth quarter of fiscal 2023
compared to the same period last year. Reported segment sales were
distorted by a change in the phasing of segment revenue recognition
versus the prior year to align with the timing of avocado sales to
customers, which is consistent with the timing of profit
recognition, as opposed to the harvest timing in Peru. As such, the
reported segment growth is contrary to the fundamental drivers that
resulted in a decline of segment sales via a combination of lower
avocado volume sold from Company-owned farms and lower realized
pricing.
Segment adjusted EBITDA decreased $11.1 million
or 91% to $1.1 million, due primarily to lower gross profit
resulting from lower volume and lower pricing on avocados sold from
Company-owned farms in Peru.
Blueberries
Net sales in the Blueberries segment increased
$9.1 million or 88% compared to the same period last year primarily
due to higher pricing driven by lower industry supply, as well as a
29% increase in volume due to an earlier harvest start and the
commencement of new production of premium varieties.
Segment adjusted EBITDA increased $4.4 million or
440% driven by higher pricing and volume.
Balance Sheet and Cash Flow
Cash and cash equivalents were $42.9 million as
of October 31, 2023 compared to $52.8 million as of
October 31, 2022.
Net cash provided by operating activities was
$29.2 million for the year ended October 31, 2023 compared to $35.2
million last year. The change was primarily driven by weaker
operating performance within the International Farming segment and
working capital growth. Within working capital, unfavorable changes
in accounts receivable and accounts payable and accrued expenses
were largely offset by favorable changes in inventory and other
receivables. Trade accounts receivable were impacted by higher
avocado sales prices as well as higher blueberry volumes and
pricing, the former of which includes balances outstanding at the
new U.K. entity which commenced operations this fiscal year. At the
International Farming segment, the earlier completion of the
avocado season compared to prior year correlated with unfavorable
changes in accounts payable and accrued expenses and conversely,
favorable changes in on-hand inventory of Company-owned fruit and
reductions in other assets from acceleration of VAT refunds.
Capital expenditures were $49.8 million for the
fiscal year ended October 31, 2023, compared to $61.2 million last
year. Expenditures in the current year were concentrated in
pre-production avocado orchard maintenance in Guatemala and Peru,
and construction costs on the Company’s new distribution facility
in the United Kingdom. Capital expenditures also included spend
related to irrigation installation and early-stage plant
cultivation for the Blueberries operation of $12.9 million in the
current year and $6.9 million in the prior year.
Outlook
For the first quarter of fiscal year 2024, the
Company is providing the following avocado industry outlook that
will drive performance:
- Industry volumes
are expected to be slightly lower in the fiscal 2024 first quarter
versus the prior year period due to expectations for a lighter
Mexican harvest resulting at least in part to smaller fruit
sizing.
- Pricing is
expected to be slightly lower on a sequential basis, but higher on
a year-over-year basis by approximately 15% compared to the $1.14
per pound average experienced in first quarter of fiscal 2023.
Conference Call and Webcast
As previously announced, the Company will host a
conference call to discuss its fourth quarter of fiscal 2023
financial results today at 5:30 p.m. ET. The conference call can be
accessed live over the phone by dialing (877) 407-9039 or for
international callers by dialing (201) 689-8470. A replay of the
call will be available through January 4, 2024 by dialing (844)
512-2921 or for international callers by dialing (412) 317-6671;
the passcode is 13742683.
The live audio webcast of the conference call
will be accessible in the News & Events section on the
Company's Investor Relations website at
https://investors.missionproduce.com. An archived replay of the
webcast will also be available shortly after the live event has
concluded.
Non-GAAP Financial Measures
This press release contains the non-GAAP
financial measures “adjusted net income” and “adjusted EBITDA.”
Management believes these measures provide useful information for
analyzing the underlying business results. These measures are not
in accordance with, nor are they a substitute for or superior to,
the comparable financial measures by generally accepted accounting
principles.
Mission Produce adjusted net income (loss)
refers to net income (loss) attributable to Mission Produce, before
stock-based compensation expense, unrealized gain (loss) on
derivative financial instruments, foreign currency gain (loss),
farming costs for nonproductive orchards (which represents land
lease costs), certain noncash and nonrecurring ERP costs,
transaction costs, amortization of inventory adjustments and
intangible asset recognized from business combinations, further
adjusted by any special, non-recurring, or one-time items such as
remeasurement, impairment or discrete tax charges that are
distortive to results, and tax effects of these items, if any, and
the tax-effected impact of these non-GAAP adjustments attributable
to noncontrolling interest, allocable to the noncontrolling owners
based on their percentage of ownership interest.
Adjusted EBITDA refers to net income (loss),
before interest expense, income taxes, depreciation and
amortization expense, stock-based compensation expense, other
income (expense), and income (loss) from equity method investees,
further adjusted by asset impairment and disposals, net of
insurance recoveries, farming costs for nonproductive orchards
(which represents land lease costs), certain noncash and
nonrecurring ERP costs, transaction costs, amortization of
inventory adjustments recognized from business combinations, and
any special, non-recurring, or one-time items such as
remeasurements or impairments, and any portion of these items
attributable to the noncontrolling interest, all of which are
excluded from the results the CEO reviews uses to assess segment
performance and results.
Reconciliations of these non-GAAP financial
measures to the most comparable GAAP measure are provided in the
table at the end of this press release.
About Mission Produce, Inc.
Mission Produce is a global leader in the
worldwide avocado business with additional offerings in mangos and
blueberries. Since 1983, Mission Produce has been sourcing,
producing and distributing fresh Hass avocados, and currently
services retail, wholesale and foodservice customers in over 25
countries. The vertically integrated Company owns and operates four
state-of-the-art packing facilities in key growing locations
globally, including California, Mexico and Peru and has additional
sourcing capabilities in Chile, Colombia, the Dominican Republic,
Guatemala, Brazil, Ecuador, South Africa and more, which allow the
company to provide a year-round supply of premium fruit. Mission’s
global distribution network includes strategically positioned
forward distribution centers across key markets throughout North
America, China, Europe, and the UK, offering value-added services
such as ripening, bagging, custom packing and logistical
management. For more information, please visit
www.missionproduce.com.
Forward-Looking Statements
Statements in this press release that are not
historical in nature are forward-looking statements that, within
the meaning of the federal securities laws, including the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995, involve known and unknown risks and uncertainties. Words
such as "may", "will", "expect", "intend", "plan", "believe",
"seek", "could", "estimate", "judgment", "targeting", "should",
"anticipate", "goal" and variations of these words and similar
expressions, are also intended to identify forward-looking
statements. The forward-looking statements in this press release
address a variety of subjects, including statements about our
short-term and long-term assumptions, goals and targets. Many of
these assumptions relate to matters that are beyond our control and
changing rapidly. Although we believe the expectations reflected in
such forward-looking statements are based upon reasonable
assumptions, we can give no assurances that our expectations will
be attained. Readers are cautioned that actual results could differ
materially from those implied by such forward-looking statements
due to a variety of factors, including: limitations regarding the
supply of avocados, either through purchasing or growing;
fluctuations in the market price of avocados; increasing
competition; risks associated with doing business internationally,
including Mexican and Peruvian economic, political and/or societal
conditions; inflationary pressures; loss of one or more of our
largest customers; general economic conditions or downturns; supply
chain failures or disruptions; disruption to the supply of reliable
and cost-effective transportation; failure to recruit or retain
employees, poor employee relations, and/or ineffective
organizational structure; inherent farming risks; seasonality in
operating results; failures associated with information technology
infrastructure, system security and cyber risks; new and changing
privacy laws and our compliance with such laws; food safety events
and recalls; failure to comply with laws and regulations, including
those promulgated by the USDA and FDA, health and safety laws,
environmental laws, and other laws and regulations; changes to
trade policy and/or export/import laws and regulations; risks from
business acquisitions, if any; lack of or failure of
infrastructure; material litigation or governmental
inquiries/actions; failure to maintain or protect our brand;
changes in tax rates or international tax legislation; risks
associated with the ongoing conflict in Russia and Ukraine; the
viability of an active, liquid, and orderly market for our common
stock; volatility in the trading price of our common stock;
concentration of control in our executive officers, directors and
principal stockholders over matters submitted to stockholders for
approval; limited sources of capital appreciation; significant
costs associated with being a public company and the allocation of
significant management resources thereto; reliance on analyst
reports; failure to maintain proper and effective internal control
over financial reporting; restrictions on takeover attempts in our
charter documents and under Delaware law; the selection of Delaware
as the exclusive forum for substantially all disputes between us
and our stockholders; risks related to restrictive covenants under
our credit facility, which could affect our flexibility to fund
ongoing operations, uses of capital and strategic initiatives, and,
if we are unable to maintain compliance with such covenants, lead
to significant challenges in meeting our liquidity requirements and
acceleration of our debt; and other risks and factors discussed
from time to time in our Annual and Quarterly Reports on Forms 10-K
and 10-Q and in our other filings with the Securities and Exchange
Commission.
You can obtain copies of our SEC filings on the
SEC’s website at www.sec.gov. The forward-looking statements
contained in this press release are made as of the date hereof and
the Corporation does not intend to, nor does it assume any
obligation to, update or supplement any forward-looking statements
after the date hereof to reflect actual results or future events or
circumstances.
Contacts:
Investor Relations ICRJeff
Sonnek646-277-1263jeff.sonnek@icrinc.com
MediaJenna AguileraMarketing
Communications ManagerMission Produce,
Inc.press@missionproduce.com
MISSION
PRODUCE, INC. Condensed Consolidated Balance
Sheets (Unaudited) |
|
|
|
|
(In millions, except for shares) |
October 31, 2023 |
|
October 31, 2022 |
Assets |
|
|
|
Current Assets: |
|
|
|
Cash and cash equivalents |
$ |
42.9 |
|
$ |
52.8 |
Restricted cash |
|
0.3 |
|
|
1.1 |
Accounts receivable |
|
|
|
Trade, net of allowances |
|
74.1 |
|
|
62.9 |
Grower and fruit advances |
|
0.9 |
|
|
1.8 |
Other |
|
12.4 |
|
|
17.3 |
Inventory |
|
70.8 |
|
|
73.1 |
Prepaid expenses and other current assets |
|
9.1 |
|
|
11.1 |
Income taxes receivable |
|
9.6 |
|
|
8.0 |
Total current assets |
|
220.1 |
|
|
228.1 |
Property, plant and equipment, net |
|
523.2 |
|
|
489.7 |
Operating lease right-of-use assets |
|
72.4 |
|
|
65.4 |
Equity method investees |
|
31.0 |
|
|
27.1 |
Deferred income tax assets, net |
|
8.5 |
|
|
8.1 |
Goodwill |
|
39.4 |
|
|
39.4 |
Intangible asset, net |
|
0.5 |
|
|
2.0 |
Other assets |
|
19.7 |
|
|
19.7 |
Total assets |
$ |
914.8 |
|
$ |
879.5 |
|
|
|
|
Liabilities and Equity |
|
|
|
Liabilities |
|
|
|
Accounts payable |
$ |
27.2 |
|
$ |
34.4 |
Accrued expenses |
|
26.4 |
|
|
30.1 |
Income taxes payable |
|
1.6 |
|
|
1.0 |
Grower payables |
|
26.4 |
|
|
24.3 |
Short-term borrowings |
|
2.8 |
|
|
2.5 |
Loans from noncontrolling interest holders—current portion |
|
0.5 |
|
|
— |
Long-term debt—current portion |
|
3.4 |
|
|
3.5 |
Operating leases—current portion |
|
6.6 |
|
|
4.7 |
Finance leases—current portion |
|
2.6 |
|
|
1.2 |
Total current liabilities |
|
97.5 |
|
|
101.7 |
Long-term debt, net of current portion |
|
148.6 |
|
|
136.9 |
Loans from noncontrolling interest holders, net of current
portion |
|
2.5 |
|
|
1.0 |
Operating leases, net of current portion |
|
71.0 |
|
|
63.9 |
Finance leases, net of current portion |
|
14.7 |
|
|
1.4 |
Income taxes payable |
|
2.3 |
|
|
3.1 |
Deferred income tax liabilities, net |
|
23.5 |
|
|
29.4 |
Other long-term liabilities |
|
26.4 |
|
|
19.2 |
Total liabilities |
|
386.5 |
|
|
356.6 |
Equity |
|
|
|
Mission Produce shareholders' equity |
|
503.6 |
|
|
502.1 |
Noncontrolling interest |
|
24.7 |
|
|
20.8 |
Total equity |
|
528.3 |
|
|
522.9 |
Total liabilities and equity |
$ |
914.8 |
|
$ |
879.5 |
MISSION PRODUCE, INC. Condensed Consolidated Statements
of Income (Loss)
(Unaudited) |
|
|
|
|
|
Three Months EndedOctober
31, |
|
Years EndedOctober 31, |
(In millions, except for share and per share amounts) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net sales |
$ |
257.9 |
|
|
$ |
238.0 |
|
|
$ |
953.9 |
|
|
$ |
1,045.9 |
|
Cost of sales |
|
230.1 |
|
|
|
211.1 |
|
|
|
870.6 |
|
|
|
956.1 |
|
Gross profit |
|
27.8 |
|
|
|
26.9 |
|
|
|
83.3 |
|
|
|
89.8 |
|
Selling, general and administrative expenses |
|
20.6 |
|
|
|
19.5 |
|
|
|
76.4 |
|
|
|
77.5 |
|
Goodwill impairment |
|
— |
|
|
|
49.5 |
|
|
|
— |
|
|
|
49.5 |
|
Operating income (loss) |
|
7.2 |
|
|
|
(42.1 |
) |
|
|
6.9 |
|
|
|
(37.2 |
) |
Interest expense |
|
(3.3 |
) |
|
|
(2.0 |
) |
|
|
(11.6 |
) |
|
|
(5.5 |
) |
Equity method income |
|
0.8 |
|
|
|
1.5 |
|
|
|
4.0 |
|
|
|
5.1 |
|
Remeasurement gain on business combination with Moruga |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2.0 |
|
Other income (expense), net |
|
1.1 |
|
|
|
0.8 |
|
|
|
(0.2 |
) |
|
|
4.4 |
|
Income (loss) before income taxes |
|
5.8 |
|
|
|
(41.8 |
) |
|
|
(0.9 |
) |
|
|
(31.2 |
) |
(Benefit) provision for income taxes |
|
(0.2 |
) |
|
|
— |
|
|
|
2.2 |
|
|
|
3.7 |
|
Net income (loss) |
$ |
6.0 |
|
|
$ |
(41.8 |
) |
|
$ |
(3.1 |
) |
|
$ |
(34.9 |
) |
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to noncontrolling interest |
|
2.0 |
|
|
|
0.2 |
|
|
|
(0.3 |
) |
|
|
(0.3 |
) |
Net income (loss) attributable to Mission Produce |
$ |
4.0 |
|
|
$ |
(42.0 |
) |
|
$ |
(2.8 |
) |
|
$ |
(34.6 |
) |
|
|
|
|
|
|
|
|
Net income (loss) per share attributable to Mission Produce: |
|
|
|
|
|
|
|
Basic |
$ |
0.06 |
|
|
$ |
(0.59 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.49 |
) |
Diluted |
$ |
0.06 |
|
|
$ |
(0.59 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.49 |
) |
|
|
|
|
|
|
|
|
Weighted average shares of common stock outstanding, used in
computing diluted earnings per share |
|
70,953,478 |
|
|
|
70,664,681 |
|
|
|
70,750,239 |
|
|
|
70,647,469 |
|
MISSION PRODUCE, INC. Condensed Consolidated Statements of
Cash Flow (Unaudited) |
|
Years EndedOctober 31, |
(In millions) |
|
2023 |
|
|
|
2022 |
|
Operating Activities |
|
|
|
Net loss |
$ |
(3.1 |
) |
|
$ |
(34.9 |
) |
Adjustments to reconcile net loss to net cash provided by operating
activities |
|
|
|
Provision for losses on accounts receivable |
|
0.1 |
|
|
|
0.1 |
|
Depreciation and amortization |
|
32.8 |
|
|
|
24.8 |
|
Amortization of debt issuance costs |
|
0.2 |
|
|
|
0.3 |
|
Equity method income |
|
(4.0 |
) |
|
|
(5.1 |
) |
Noncash lease expense |
|
5.9 |
|
|
|
5.3 |
|
Stock-based compensation |
|
4.5 |
|
|
|
3.6 |
|
Dividends received from equity method investees |
|
2.7 |
|
|
|
2.2 |
|
Losses on asset impairment, disposals and sales, net of insurance
recoveries |
|
1.3 |
|
|
|
0.4 |
|
Deferred income taxes |
|
(6.4 |
) |
|
|
(0.6 |
) |
Goodwill impairment |
|
— |
|
|
|
49.5 |
|
Remeasurement gain on business combination with Moruga |
|
— |
|
|
|
(2.0 |
) |
Unrealized losses on foreign currency transactions |
|
1.4 |
|
|
|
— |
|
Unrealized gains on derivative financial instruments |
|
(0.1 |
) |
|
|
(4.7 |
) |
Other |
|
0.1 |
|
|
|
0.1 |
|
Effect on cash of changes in operating assets and liabilities, net
of acquisition: |
|
|
|
Trade accounts receivable |
|
(10.6 |
) |
|
|
10.6 |
|
Grower fruit advances |
|
0.9 |
|
|
|
(1.2 |
) |
Other receivables |
|
5.0 |
|
|
|
(2.4 |
) |
Inventory |
|
3.0 |
|
|
|
(15.3 |
) |
Prepaid expenses and other current assets |
|
2.0 |
|
|
|
(0.4 |
) |
Income taxes receivable |
|
(1.6 |
) |
|
|
(1.1 |
) |
Other assets |
|
1.0 |
|
|
|
0.2 |
|
Accounts payable and accrued expenses |
|
(8.9 |
) |
|
|
9.4 |
|
Income taxes payable |
|
(0.2 |
) |
|
|
(1.3 |
) |
Grower payables |
|
2.2 |
|
|
|
2.2 |
|
Operating lease liabilities |
|
(3.8 |
) |
|
|
(4.0 |
) |
Other long-term liabilities |
|
4.8 |
|
|
|
(0.5 |
) |
Net cash provided by operating activities |
$ |
29.2 |
|
|
$ |
35.2 |
|
Investing Activities |
|
|
|
Purchases of property, plant and equipment |
|
(49.8 |
) |
|
|
(61.2 |
) |
Proceeds from sale of property, plant and equipment |
|
0.2 |
|
|
|
3.0 |
|
Cash acquired in consolidation of Moruga |
|
— |
|
|
|
4.3 |
|
Investment in equity method investees |
|
(2.1 |
) |
|
|
(0.4 |
) |
Purchase of other investment |
|
(2.3 |
) |
|
|
— |
|
Loan repayments from equity method investees |
|
— |
|
|
|
3.0 |
|
Other |
|
(0.1 |
) |
|
|
(0.1 |
) |
Net cash used in investing activities |
$ |
(54.1 |
) |
|
$ |
(51.4 |
) |
Financing Activities |
|
|
|
Borrowings on revolving credit facility |
|
145.0 |
|
|
|
80.0 |
|
Payments on revolving credit facility |
|
(130.0 |
) |
|
|
(40.0 |
) |
Proceeds from short-term borrowings |
|
2.8 |
|
|
|
2.5 |
|
Repayment of short-term borrowings |
|
(2.5 |
) |
|
|
— |
|
Principal payments on long-term debt obligations |
|
(3.5 |
) |
|
|
(63.3 |
) |
Principal payments on finance lease obligations |
|
(2.6 |
) |
|
|
(1.2 |
) |
Payments for long-term supplier financing |
|
(0.1 |
) |
|
|
— |
|
Proceeds from loan from noncontrolling interest holder |
|
2.0 |
|
|
|
— |
|
Purchase and retirement of common stock |
|
(0.6 |
) |
|
|
— |
|
Taxes paid related to shares withheld from the settlement of equity
awards |
|
(0.5 |
) |
|
|
— |
|
Exercise of stock options |
|
0.1 |
|
|
|
0.1 |
|
Payment of debt issuance, restructuring or extinguishment fees |
|
— |
|
|
|
(0.8 |
) |
Equity contributions from noncontrolling interest holders |
|
4.2 |
|
|
|
0.9 |
|
Net cash provided by (used in) financing activities |
$ |
14.3 |
|
|
$ |
(21.8 |
) |
Effect of exchange rate changes on cash |
|
(0.1 |
) |
|
|
(0.3 |
) |
Net decrease in cash, cash equivalents and restricted cash |
|
(10.7 |
) |
|
|
(38.3 |
) |
Cash, cash equivalents and restricted cash, beginning of
period |
|
53.9 |
|
|
|
92.2 |
|
Cash, cash equivalents and restricted cash, end of period |
$ |
43.2 |
|
|
$ |
53.9 |
|
|
|
|
|
Summary of cash, cash equivalents and restricted cash
reported within the consolidated balance sheets: |
|
|
|
Cash and cash equivalents |
$ |
42.9 |
|
|
$ |
52.8 |
|
Restricted cash |
|
0.3 |
|
|
|
1.1 |
|
Total cash, cash equivalents, and restricted cash shown in the
consolidated statements of cash flows |
$ |
43.2 |
|
|
$ |
53.9 |
|
MISSION PRODUCE, INC. Reconciliation of
Non-GAAP Financial Measures to GAAP (Unaudited)
The following tables reconcile the non-GAAP
measures “adjusted net income” and “adjusted EBITDA” to their
comparable GAAP measures. Refer also to “Non-GAAP Financial
Measures” earlier in this press release.
Adjusted Net Income
|
Three Months EndedOctober
31, |
|
Years EndedOctober 31, |
(In millions, except for per share amounts) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net income (loss) attributable to Mission Produce |
$ |
4.0 |
|
|
$ |
(42.0 |
) |
|
$ |
(2.8 |
) |
|
$ |
(34.6 |
) |
Stock-based compensation |
|
1.3 |
|
|
|
1.0 |
|
|
|
4.5 |
|
|
|
3.6 |
|
Unrealized loss (gain) on derivative financial instruments |
|
0.7 |
|
|
|
(1.5 |
) |
|
|
2.3 |
|
|
|
(6.0 |
) |
Foreign currency transaction loss (gain) |
|
(0.8 |
) |
|
|
0.9 |
|
|
|
1.8 |
|
|
|
2.0 |
|
Asset impairment and disposals, net of insurance recoveries |
|
0.1 |
|
|
|
0.2 |
|
|
|
1.3 |
|
|
|
0.4 |
|
Farming costs for nonproductive orchards(1) |
|
1.0 |
|
|
|
0.4 |
|
|
|
3.8 |
|
|
|
1.5 |
|
ERP costs(2) |
|
0.5 |
|
|
|
0.8 |
|
|
|
2.2 |
|
|
|
4.6 |
|
Executive severance |
|
1.3 |
|
|
|
— |
|
|
|
1.3 |
|
|
|
— |
|
Transaction costs |
|
— |
|
|
|
0.1 |
|
|
|
0.3 |
|
|
|
0.6 |
|
Amortization of inventory adjustment recognized from business
combination |
|
— |
|
|
|
0.4 |
|
|
|
0.7 |
|
|
|
0.4 |
|
Amortization of intangible asset recognized from business
combination |
|
0.3 |
|
|
|
— |
|
|
|
1.5 |
|
|
|
— |
|
Goodwill impairment(3) |
|
— |
|
|
|
49.5 |
|
|
|
— |
|
|
|
49.5 |
|
Remeasurement gain on business combination with Moruga(3) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(2.0 |
) |
Tax effects of adjustments to net loss attributable to Mission
Produce(4) |
|
(0.7 |
) |
|
|
(0.4 |
) |
|
|
(4.1 |
) |
|
|
(1.3 |
) |
Nonrecurring discrete tax charge(5) |
|
— |
|
|
|
— |
|
|
|
1.8 |
|
|
|
— |
|
Noncontrolling interest(6) |
|
(0.2 |
) |
|
|
(0.2 |
) |
|
|
(1.3 |
) |
|
|
(0.2 |
) |
Mission Produce adjusted net income |
$ |
7.5 |
|
|
$ |
9.2 |
|
|
$ |
13.3 |
|
|
$ |
18.5 |
|
Mission Produce adjusted net income per diluted share |
$ |
0.11 |
|
|
$ |
0.13 |
|
|
$ |
0.19 |
|
|
$ |
0.26 |
|
(1) During the three months ended
October 31, 2023, $0.5 million related to blueberry orchards and
$0.5 million related to avocado orchards. During the twelve months
ended October 31, 2023, $2.0 million related to the blueberry
orchards and $1.8 million related to avocado orchards. All costs in
fiscal 2022 were related to avocado orchards.
(2) Includes recognition of deferred
implementation costs for both periods. Amounts for fiscal year 2022
also included non-recurring post-implementation process
reengineering costs.
(3) Neither deductible nor taxable for
income tax purposes.
(4) Tax effects are calculated using
applicable rates that each adjustment relates to.
(5) The Company recorded a discrete
charge to income tax expense related to a statutory case in Mexico
during fiscal 2023.
(6) Represents net income or loss
attributable to noncontrolling interest plus the impact of
tax-effected non-GAAP adjustments, allocable to the noncontrolling
owner based on their percentage of ownership interest.
MISSION PRODUCE, INC.
Adjusted EBITDA
|
Three Months EndedOctober
31, |
|
Years EndedOctober 31, |
(In millions) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Marketing and Distribution adjusted EBITDA |
$ |
10.8 |
|
|
$ |
4.0 |
|
|
$ |
40.1 |
|
|
$ |
23.5 |
|
International Farming adjusted EBITDA |
|
1.1 |
|
|
|
12.2 |
|
|
|
3.1 |
|
|
|
23.3 |
|
Blueberries adjusted EBITDA |
|
5.4 |
|
|
|
1.0 |
|
|
|
5.2 |
|
|
|
0.8 |
|
Total reportable segment adjusted EBITDA |
|
17.3 |
|
|
|
17.2 |
|
|
$ |
48.4 |
|
|
$ |
47.6 |
|
Net income (loss) |
|
6.0 |
|
|
|
(41.8 |
) |
|
|
(3.1 |
) |
|
|
(34.9 |
) |
Interest expense |
|
3.3 |
|
|
|
2.0 |
|
|
|
11.6 |
|
|
|
5.5 |
|
(Benefit) provision for income taxes |
|
(0.2 |
) |
|
|
— |
|
|
|
2.2 |
|
|
|
3.7 |
|
Depreciation and amortization(1) |
|
10.0 |
|
|
|
7.6 |
|
|
|
32.8 |
|
|
|
24.8 |
|
Equity method income |
|
(0.8 |
) |
|
|
(1.5 |
) |
|
|
(4.0 |
) |
|
|
(5.1 |
) |
Stock-based compensation |
|
1.3 |
|
|
|
1.0 |
|
|
|
4.5 |
|
|
|
3.6 |
|
Executive severance |
|
1.3 |
|
|
|
— |
|
|
|
1.3 |
|
|
|
— |
|
Asset impairment and disposals, net of insurance recoveries |
|
0.1 |
|
|
|
0.2 |
|
|
|
1.3 |
|
|
|
0.4 |
|
Farming costs for nonproductive orchards |
|
0.5 |
|
|
|
0.4 |
|
|
|
1.8 |
|
|
|
1.5 |
|
ERP costs(2) |
|
0.5 |
|
|
|
0.8 |
|
|
|
2.2 |
|
|
|
4.6 |
|
Transaction costs |
|
— |
|
|
|
0.1 |
|
|
|
0.3 |
|
|
|
0.6 |
|
Amortization of inventory adjustment recognized from business
combination |
|
— |
|
|
|
0.4 |
|
|
|
0.7 |
|
|
|
0.4 |
|
Goodwill impairment |
|
— |
|
|
|
49.5 |
|
|
|
— |
|
|
|
49.5 |
|
Remeasurement gain on business combination with Moruga |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(2.0 |
) |
Other (income) expense, net |
|
(1.1 |
) |
|
|
(0.8 |
) |
|
|
0.2 |
|
|
|
(4.4 |
) |
Noncontrolling interest(3) |
|
(3.6 |
) |
|
|
(0.7 |
) |
|
|
(3.4 |
) |
|
|
(0.6 |
) |
Total adjusted EBITDA |
$ |
17.3 |
|
|
$ |
17.2 |
|
|
$ |
48.4 |
|
|
$ |
47.6 |
|
(1) Includes depreciation and
amortization of purchase accounting assets of $0.6 million and
$2.4 million for the three and twelve months ended October 31,
2023, respectively, and $0.9 million and $1.4 million for the
three and twelve months ended October 31, 2022, respectively.
(2) Includes recognition of deferred
implementation costs for both periods, and for the three and twelve
months ended October 31, 2022, non-recurring post-implementation
process reengineering costs are also included.
(3) Represents net income or loss
attributable to noncontrolling interest plus the impact of non-GAAP
adjustments, allocable to the noncontrolling owner based on their
percentage of ownership interest.
MISSION PRODUCE, INC.
Other Information
(Unaudited)
Segment Sales
|
Marketing and Distribution |
|
International Farming |
|
Blueberries |
|
Total |
|
Marketing and Distribution |
|
International Farming |
|
Blueberries |
|
Total |
|
Three Months EndedOctober
31, |
(In millions) |
|
2023 |
|
|
|
2022 |
|
Third party sales |
$ |
236.2 |
|
$ |
2.2 |
|
|
$ |
19.5 |
|
$ |
257.9 |
|
|
$ |
221.2 |
|
$ |
6.4 |
|
|
$ |
10.4 |
|
$ |
238.0 |
|
Affiliated sales |
|
— |
|
|
38.1 |
|
|
|
— |
|
|
38.1 |
|
|
|
— |
|
|
33.4 |
|
|
|
— |
|
|
33.4 |
|
Total segment sales |
|
236.2 |
|
|
40.3 |
|
|
|
19.5 |
|
|
296.0 |
|
|
|
221.2 |
|
|
39.8 |
|
|
|
10.4 |
|
|
271.4 |
|
Intercompany eliminations |
|
— |
|
|
(38.1 |
) |
|
|
— |
|
|
(38.1 |
) |
|
|
— |
|
|
(33.4 |
) |
|
|
— |
|
|
(33.4 |
) |
Total net sales |
$ |
236.2 |
|
$ |
2.2 |
|
|
$ |
19.5 |
|
$ |
257.9 |
|
|
$ |
221.2 |
|
$ |
6.4 |
|
|
$ |
10.4 |
|
$ |
238.0 |
|
|
Years EndedOctober 31, |
|
|
2023 |
|
|
|
2022 |
|
Third party sales |
$ |
889.9 |
|
$ |
11.6 |
|
|
$ |
52.4 |
|
$ |
953.9 |
|
|
$ |
1,016.1 |
|
$ |
19.1 |
|
|
$ |
10.7 |
|
$ |
1,045.9 |
|
Affiliated sales |
|
— |
|
|
78.6 |
|
|
|
— |
|
|
78.6 |
|
|
|
— |
|
|
95.6 |
|
|
|
— |
|
|
95.6 |
|
Total segment sales |
|
889.9 |
|
|
90.2 |
|
|
|
52.4 |
|
|
1,032.5 |
|
|
|
1,016.1 |
|
|
114.7 |
|
|
|
10.7 |
|
|
1,141.5 |
|
Intercompany eliminations |
|
— |
|
|
(78.6 |
) |
|
|
— |
|
|
(78.6 |
) |
|
|
— |
|
|
(95.6 |
) |
|
|
— |
|
|
(95.6 |
) |
Total net sales |
$ |
889.9 |
|
$ |
11.6 |
|
|
$ |
52.4 |
|
$ |
953.9 |
|
|
$ |
1,016.1 |
|
$ |
19.1 |
|
|
$ |
10.7 |
|
$ |
1,045.9 |
|
Avocado Sales
|
Three Months EndedOctober
31, |
|
Years EndedOctober 31, |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
Pounds of avocados sold(millions) |
|
162.4 |
|
|
169.2 |
|
|
654.4 |
|
|
584.3 |
Average sales price per pound |
$ |
1.39 |
|
$ |
1.28 |
|
$ |
1.30 |
|
$ |
1.71 |
Sales by Type
|
Three Months EndedOctober
31, |
|
Years EndedOctober 31, |
(In millions) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
Avocado |
$ |
225.0 |
|
$ |
216.9 |
|
$ |
851.1 |
|
$ |
998.4 |
Other |
|
32.9 |
|
|
21.1 |
|
|
102.8 |
|
|
47.5 |
Total net sales |
$ |
257.9 |
|
$ |
238.0 |
|
$ |
953.9 |
|
$ |
1,045.9 |
Mission Produce (NASDAQ:AVO)
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Mission Produce (NASDAQ:AVO)
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