Harold Edwards, President and Chief Executive Officer, stated, “We are pleased with our second quarter financial results, as we achieved strong top line growth of 29% and significantly improved our profitability on a year-over-year basis. Our agribusiness revenue increased 31% in the second quarter, driven by strong lemon sales due to more cartons sold and higher prices. Our avocado sales also increased, and we expect to generate significant revenue contribution from our avocado sales in the third quarter when avocados experience peak seasonality.”
Mr. Edwards continued, “In the second quarter, we achieved strong revenue and earnings growth and entered into key agreements and acquisitions that will benefit our business in coming quarters. We recently announced two separate agreements to acquire an aggregate of 125 acres of agricultural property in the San Joaquin Valley of California, which is strategically located near our existing orchards in Porterville, California. Similar to our Sheldon lease agreement in the first fiscal quarter, these acquisitions add to our portfolio of quality citrus acreage. We look forward to continuing to capitalize on selective, strategic acquisitions as the opportunities arise. In addition, we entered into an agreement with Associated Citrus Packers of Yuma, Arizona, to pack and market an estimated 850,000 cartons of lemons to begin in the fourth quarter of this fiscal year. Regarding our real estate development efforts, we continue to evaluate market conditions and are committed to capitalizing on opportunities to monetize our real estate portfolio at the appropriate time.”
Balance Sheet and LiquidityThe Company had working capital of $1.2 million as of April 30, 2012. Cash generated by operating activities in the second quarter of fiscal year 2012 was $2.0 million, compared to $0.9 million in the second quarter of fiscal year 2011. Seasonality in agriculture operations results in corresponding quarterly fluctuations in operating cash flows. As operating cash flows typically improve during the year, the Company plans to apply such cash flows towards debt reduction and investments in strategic objectives.