Limoneira Earnings: Q2 Shows Resilience Amid Citrus Price Pressures
- Hardik Shah
- Jun 10
- 3 min read
TLDR
Avocado pricing shined with $2.26/lb average, boosting segment margins despite lower volumes.
$5M annual EBITDA gain expected from merging citrus sales with Sunkist Growers starting FY26.
Real estate & water monetization remain strong tailwinds, with $180M+ in projected JV proceeds.
Business Overview
Limoneira Company (NASDAQ: LMNR) is a diversified agribusiness and real estate development firm with global operations spanning the U.S., Chile, and Argentina. The company primarily grows, packs, and markets citrus—especially lemons and avocados—while also leveraging valuable land and water assets. Its real estate venture, Harvest at Limoneira, is a long-term growth lever focused on residential development in California.
Limoneira Earnings Q2'25
Total revenue fell 21% YoY to $35.1M, mainly due to citrus price compression.
Agribusiness revenue declined to $33.6M (from $43.3M), with lemon sales down sharply.
Net loss was $3.5M, compared to a net income of $6.4M in Q2 FY24.
Adjusted EBITDA swung to a loss of $167K, down from a $16.6M profit last year.
EPS: GAAP EPS of -0.20, adjusted EPS of -0.17 (vs. +0.44 prior year).
“The oversupplied lemon market created pricing pressure in our second quarter, yet we delivered strong results across our other business lines.” — CEO Harold Edwards
Forward Guidance
Fresh lemon volume outlook for FY25 was revised down to 4.5–5.0M cartons (from 5.0–5.5M).
Avocado volume remains guided at 7–8M pounds, with improved pricing expected in Q3.
FY26 lemon volumes are projected between 4.0–4.5M cartons post-Sunkist transition.
Limoneira expects $180M in proceeds from its Harvest JV and East Area II over 7 years.
Management expects long-term EBITDA to reach $50M by 2030 through avocado expansion.
Operational Performance
Avocado pricing surged to $2.26/lb (vs. $1.47 last year), offsetting lower volumes.
Lemon prices fell 19% to $14.52/carton amid an oversupplied market.
Orange sales rose to $1.6M as volumes grew to 92K cartons.
Farm management revenue plummeted after contract terminations.
Q2 operating loss improved to $3.3M (vs. $4.7M prior year) due to cost containment.
Market Insights
The citrus market faced industry-wide oversupply, with competitors reportedly selling below cost. Limoneira aims to buffer such volatility through its Sunkist partnership, enhancing price stability and market access.
“We expect relief from these challenging market conditions in the second half of the year... [and] more efficient cost structure to maintain profitability.” — CFO Mark Palamountain
In contrast, avocados continue to benefit from strong consumer demand, and pricing remains favorable, especially for larger fruit sizes.
Strategic Initiatives
Sunkist Partnership: Starting FY26, citrus sales and marketing operations will merge into Sunkist Growers. Expected to save $5M annually and improve EBITDA by the same amount.
Asset Monetization: Closed $1.7M in water rights sales in Q2; two more transactions expected this year.
Real Estate: Harvest at Limoneira has sold 1,261 lots since inception; Phase 3 fast-tracked with additional 550 units approved.
Avocado Expansion: 2,000 acres planned by FY27, with some early plantings already outperforming yield expectations.
“We’re accelerating execution on our stated priorities… This represents the natural evolution of strategies we’ve been discussing.” — CEO Harold Edwards
Capital Allocation
Debt: Net debt stood at $52.9M, up from $40M at FY24 end.
Liquidity: Cash on hand was $2.1M; received $10M from Harvest JV in April.
No new share buybacks or dividends announced this quarter.
The Bottom Line
Limoneira’s Q2 FY25 results reflect a challenging lemon market offset by strong avocado performance and tight cost control. The upcoming Sunkist partnership is a pivotal shift, expected to streamline operations, reduce volatility, and drive long-term EBITDA growth. Investors should watch for Q3 avocado volumes, updates on Phase 3 of the Harvest project, and continued progress on water rights monetization.
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