Calavo Growers, Inc. (Nasdaq-GS: CVGW), a global avocado-industry leader and expanding provider of value-added fresh foods, today reported that fiscal 2012 fourth-quarter net income rose 69 percent to the highest quarterly net income in company history from the fourth quarter last year. These results, which drove up annual net income by 54 percent over prior year, were paced by “continued operating strength across all three of Calavo’s business segments.”
Current-year, three-month and annual results for the company’s Renaissance Food Group, LLC (RFG) business segment are now reported separately from the legacy Calavo Foods business segment.
For the three months ended Oct. 31, 2012, net income advanced to a record $6.2 million, equal to $0.42 per diluted share, from $3.6 million, or $0.25 per diluted share in the fiscal 2011 fourth quarter. Revenues totaled $141.6 million versus $147.3 million in the fiscal 2011 fourth quarter, owing primarily to the decline in fresh avocados prices which has resulted from the significantly larger current-year fruit supply.
Gross margin in the final quarter advanced 35 percent to a record $17.9 million, equal to 12.6 percent of total revenues, from $13.2 million, or 9.0 percent of total revenues, in the corresponding quarter one year ago. Operating income increased to $7.6 million, a 19 percent jump from $6.4 million in the fourth quarter of fiscal 2011.
Fourth-quarter selling, general and administrative (SG&A) expenses totaled $10.3 million, equal to 7.2 percent of revenues, versus $6.8 million, or 4.6 percent of revenues, in the same quarter last year. The increased SG&A in the most-recent quarter is principally attributable to costs associated with Calavo’s management-incentive plan for surpassing earnings targets. SG&A as a percentage of gross margin increased to 57.4 percent in the most recent quarter from 51.6 percent in the year-earlier fourth quarter.
Chairman, President and CEO Lee E. Cole stated: “Calavo registered the single-highest net income for any period in its history during the final quarter, enabling us to post results for fiscal 2012 that are among its best ever, including revenues and gross margin which shattered previous record highs. We benefited from strong showings in each of our three business segments and this operating momentum continues to validate the strategic blueprint we established for the company—all indicators are trending favorably.”