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TheStreet Open House

Limoneira Company Announces Second Quarter And Six Months Fiscal Year 2012 Financial Results

Stocks in this article: LMNR

In April 2012, the Company purchased land for use as a citrus orchard and also entered into a separate agreement to acquire an additional citrus orchard for purchase prices of $430,000 and $800,000, respectively, paid or to be paid in cash. The acquisitions are for 60 and 65 acres of agricultural property, respectively, and both properties are located in close proximity to the Company’s existing orchards in Porterville, California. The acquired citrus orchard was accounted for as an asset purchase with substantially the entire purchase price allocated to land and included in property, plant and equipment on the Company’s consolidated balance sheet at April 30, 2012. The second acquisition was in escrow at April 30, 2012.

About Limoneira Company

Limoneira Company, a 119-year-old international agribusiness headquartered in Santa Paula, California, has grown to become one of the premier integrated agribusinesses in the world. Limoneira (pronounced lē mon΄âra), is a dedicated sustainability company with approximately 7,850 acres of rich agricultural lands, real estate properties and water rights in California. The Company is a leading producer of lemons, avocados, oranges, specialty citrus and other crops that are enjoyed throughout the world. For more about Limoneira Company, visit www.limoneira.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on Limoneira’s current expectations about future events and can be identified by terms such as “expect,” “may,” “anticipate,” “intend,” “should be,” “will be,” “is likely to,” “strive to,” and similar expressions referring to future periods.

Limoneira believes the expectations reflected in the forward-looking statements are reasonable but cannot guarantee future results, level of activity, performance or achievements. Actual results may differ materially from those expressed or implied in the forward-looking statements. Therefore, Limoneira cautions you against relying on any of these forward-looking statements. Factors which may cause future outcomes to differ materially from those foreseen in forward-looking statements include, but are not limited to: changes in laws, regulations, rules, quotas, tariffs and import laws; weather conditions that affect production, transportation, storage, import and export of fresh product; increased pressure from disease, insects and other pests; disruption of water supplies or changes in water allocations; pricing and supply of raw materials and products; market responses to industry volume pressures; pricing and supply of energy; changes in interest and currency exchange rates; availability of financing for land development activities; political changes and economic crises; international conflict; acts of terrorism; labor disruptions, strikes or work stoppages; loss of important intellectual property rights; inability to pay debt obligations; inability to engage in certain transactions due to restrictive covenants in debt instruments; government restrictions on land use; increased costs from becoming a public company and market and pricing risks due to concentrated ownership of stock. Other risks and uncertainties include those that are described in Limoneira’s SEC filings, which are available on the SEC’s website at http://www.sec.gov . Limoneira undertakes no obligation to subsequently update or revise the forward-looking statements made in this press release, except as required by law.

Non-GAAP Financial Measures

Due to significant depreciable assets associated with the nature of the Company’s operations and interest costs associated with its capital structure, management believes that earnings before interest, income taxes, depreciation and amortization (“EBITDA”) and Adjusted EBITDA, which excludes impairments on real estate development assets, is an important measure to evaluate the Company’s results of operations between periods on a more comparable basis. Such measurements are not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), and should not be construed as an alternative to reported results determined in accordance with GAAP. The non-GAAP information provided is unique to the Company and may not be consistent with methodologies used by other companies. Unaudited EBITDA and Adjusted EBITDA are summarized and reconciled to net income, which management considers to be the most directly comparable financial measure calculated and presented in accordance with GAAP as follows:

  Quarter ended April 30,   Six Months Ended April 30,
  2012       2011     2012       2011  
Net income (loss) $ 737,000 $ (264,000 ) $ (2,072,000 ) $ (3,591,000 )
Total interest (income) expense, net (152,000 ) 203,000 (161,000 ) 51,000
Income taxes 385,000 (197,000 ) (1,195,000 ) (1,909,000 )
Depreciation and amortization   546,000     532,000     1,066,000     1,100,000  
EBITDA 1,516,000 274,000 (2,362,000 ) (4,349,000 )
Impairments of real estate development assets   -     1,196,000     -     1,196,000  
Adjusted EBITDA $ 1,516,000   $ 1,470,000   $ (2,362,000 ) $ (3,153,000 )
 
     
Limoneira Company

Consolidated Balance Sheets (unaudited)

 
April 30,

2012

  October 31,

2011

 
Assets
Current assets:
Cash $ 16,000 $ 21,000
Accounts receivable, net 7,062,000 2,410,000
Notes receivable – related parties 41,000 36,000
Notes receivable - 350,000
Cultural costs 1,121,000 926,000
Prepaid expenses and other current assets 2,251,000 1,385,000
Income taxes receivable   2,119,000     1,324,000  
Total current assets 12,610,000 6,452,000
Property, plant and equipment, net 50,024,000 49,187,000
Real estate development 74,418,000 72,623,000
Equity in investments 8,966,000 8,896,000
Investment in Calavo Growers, Inc. 19,072,000 15,009,000
Notes receivable – related parties 16,000 56,000
Notes receivable 2,412,000 2,123,000
Other assets   5,133,000     4,682,000  
Total assets $ 172,651,000   $ 159,028,000  
 
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable $ 3,408,000 $ 2,650,000
Growers payable 4,435,000 1,004,000
Accrued liabilities 2,809,000 2,399,000
Current portion of long-term debt   748,000     736,000  
Total current liabilities 11,400,000 6,789,000
Long-term liabilities:
Long-term debt, less current portion 89,972,000 82,135,000
Deferred income taxes 11,337,000 10,160,000
Other long-term liabilities   8,754,000     7,892,000  
Total long-term liabilities 110,063,000 100,187,000
Commitments and contingencies
Stockholders’ equity:

Series B Convertible Preferred Stock – $100.00 par value (50,000 shares authorized: 30,000 shares issued and outstanding at April 30, 2012 and October 31, 2011) (8.75% coupon rate)

3,000,000 3,000,000

Series A Junior Participating Preferred Stock – $.01 par value (50,000 shares authorized: 0 issued or outstanding at April 30, 2012 and October 31, 2011)

- -
Common Stock – $.01 par value (19,900,000 shares authorized:

11,196,745 and 11,205,241 shares issued and outstanding at April 30, 2012 and October 31, 2011, respectively)

112,000 112,000
Additional paid-in capital 35,121,000 34,863,000
Retained earnings 12,078,000 14,980,000
Accumulated other comprehensive income (loss)   877,000     (903,000 )
Total stockholders’ equity   51,188,000     52,052,000  
Total liabilities and stockholders’ equity $ 172,651,000   $ 159,028,000  
 
   
Limoneira Company

Consolidated Statements of Operations (unaudited)

 
Three months ended

April 30,

Six months ended

April 30,

   
  2012     2011     2012   2011  
Revenues:
Agribusiness $ 15,046,000 $ 11,463,000 $ 24,248,000 $ 16,338,000
Rental operations 1,006,000 996,000 1,997,000 1,966,000
Real estate development   44,000     51,000     88,000     107,000  
Total revenues 16,096,000 12,510,000 26,333,000 18,411,000
Costs and expenses:
Agribusiness 11,680,000 9,740,000 23,070,000 17,378,000
Rental operations 530,000 532,000 1,098,000 1,092,000
Real estate development 241,000 367,000 489,000 657,000
Impairments of real estate development assets - 1,196,000 - 1,196,000
Selling, general and administrative   2,513,000     2,220,000     5,284,000     5,170,000  
Total costs and expenses   14,964,000     14,055,000     29,941,000     25,493,000  
Operating income (loss) 1,132,000 (1,545,000 ) (3,608,000 ) (7,082,000 )
Other income (expense):
Interest expense (71,000 ) (268,000 ) (246,000 ) (622,000 )
Interest income from derivative instruments 196,000 38,000 355,000 515,000
Gain on sale of Rancho Refugio/Caldwell Ranch - 1,351,000 - 1,351,000
Interest income 27,000 27,000 52,000 56,000
Other (expense) income, net   (137,000 )   (34,000 )   208,000     303,000  
Total other income   15,000     1,114,000     369,000     1,603,000  
Income before income tax (provision) benefit

and equity in losses of investments

1,147,000 (431,000

 

)

(3,239,000 ) (5,479,000

 

)

Income tax (provision) benefit (385,000 ) 197,000 1,195,000 1,909,000
Equity in losses of investments   (25,000 )   (30,000 )   (28,000 )   (21,000 )
Net income (loss) 737,000 (264,000 ) (2,072,000 ) (3,591,000 )
Preferred dividends   (65,000 )   (65,000 )   (131,000 )   (131,000 )
Net income (loss) applicable to common stock $ 672,000   $ (329,000 ) $ (2,203,000 ) $ (3,722,000 )
                       
Basic net income (loss) per common share $ 0.06   $ (0.03 ) $ (0.20 ) $ (0.33 )
                         
Diluted net income (loss) per common share $ 0.06   $ (0.03 ) $ (0.20 ) $ (0.33 )
                       
Dividends per common share $ 0.03   $ 0.03   $ 0.06   $ 0.06  
 
Weighted-average common shares outstanding-basic 11,201,000 11,217,000 11,203,000 11,205,000
Weighted-average common shares outstanding-diluted 11,201,000 11,217,000 11,203,000 11,205,000




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