Limoneira (NASDAQ:LMNR) reported lower third-quarter fiscal 2026 revenue and a wider net loss, as lighter lemon sales volume and changes tied to its transition of citrus brokerage operations to Sunkist weighed on results. However, the company said adjusted EBITDA improved from the prior-year period, supported by higher agribusiness operating income, stronger avocado volume and lower selling, general and administrative expenses.
President and Chief Executive Officer Harold Edwards said the company’s quarterly results were below its expectations because lemon sales volume was lighter than anticipated. He said Limoneira now expects to reach the lower end of its full-year lemon volume outlook, citing elevated lemon imports into the U.S. market.
Third-Quarter Results
Chief Financial Officer Greg Hamm said the revenue decline primarily reflected the transition of citrus brokerage operations to Sunkist. The transition eliminated orange and specialty citrus revenue and reduced brokered lemon and other lemon sales. Those factors were partly offset by higher fresh lemon carton sales resulting from improved pricing.
Fresh lemon carton sales rose to $27.3 million from $23.8 million in the prior-year quarter. Limoneira sold approximately 1.373 million cartons at an average price of $19.88 per carton, compared with 1.397 million cartons at $17.02 per carton a year earlier. The reported sales and pricing figures are net of Sunkist marketing fees.
Brokered lemons and other lemon sales were immaterial during the quarter, compared with $3.8 million in the prior-year period. The company recorded no orange revenue, compared with $1.7 million a year ago, and no specialty citrus and wine grape revenue, compared with $600,000 in the prior-year quarter.
Avocado revenue declined because of lower prices, despite a higher volume of sales. Limoneira sold about 7 million pounds of avocados in the third quarter at an average price of $1.15 per pound, compared with 5.7 million pounds at $1.50 per pound in the same period last year. Hamm said the volume included harvest that had been intentionally delayed from the second quarter to maximize pricing, as well as the typical alternating high and low production cycles of California avocado crops.
Total costs and expenses fell to $46.8 million from $48.1 million, reflecting lower agribusiness costs and lower SG&A expenses, partly offset by an impairment of assets related to Windfall Farms. SG&A expense declined to $4 million from $5 million, primarily due to lower salaries, benefits and selling expenses associated with the Sunkist transition.
Limoneira posted an operating loss of $3 million, compared with an operating loss of $600,000 a year earlier. Net loss applicable to common stock after preferred dividends was $3 million, or 17 cents per diluted share, compared with a $1 million loss, or 6 cents per diluted share, in the prior-year period.
On an adjusted basis, net income was $400,000, or 2 cents per diluted share, compared with an adjusted net loss of $400,000, or 2 cents per diluted share, a year earlier. Adjusted EBITDA rose to $3.9 million from $3 million.
Lemon Imports Pressure Volume Outlook
Edwards said an oversupply of Argentine lemons in the U.S. market was the “sole culprit” behind the pressure on Limoneira’s lemon sales volume and pricing. He said South African lemons had oversupplied Western Europe, prompting Argentine fruit that would typically go to Europe to be diverted to the United States.
Although the imported fruit is diminishing in the market and prices have begun to firm, Edwards said Limoneira intentionally held back some supply from the fourth quarter out of caution. The company now expects fiscal 2026 fresh lemon sales of 4 million to 4.25 million cartons.
Meanwhile, Limoneira increased its avocado volume outlook to 7 million to 7.25 million pounds for fiscal 2026, from its prior outlook of 5.5 million to 6.5 million pounds. Through the first nine months of the fiscal year, the company had sold approximately 7.3 million pounds, exceeding the high end of its prior full-year range.
For fiscal 2027, management expects avocado volume to exceed 10 million pounds, an increase of at least 30% from fiscal 2026. Edwards said 400 acres planted in 2023 and 2024 are expected to contribute to next year’s crop, while an additional 400 non-bearing acres are expected to begin producing over the following two to four years.
Hamm said 6 million to 7 million pounds of expected 2027 avocado volume would come from acreage already in production. Edwards cautioned that weather, wind and other events could still affect harvestable volume, though the company sees a large crop currently set on its trees.
Asset Sales, Water Rights and Development Plans
Limoneira expects its sale of Windfall Farms for $15 million in cash to close Sept. 14, subject to customary closing conditions. The company plans to use proceeds to reduce debt and fund continued avocado acreage expansion. Under a separate farming agreement, Limoneira will continue to farm the vineyard property for $200,000 annually plus reimbursement of all property expenses. The buyer excluded the 2026 crop from the transaction, allowing Limoneira to retain the economic benefit of this year’s vineyard crop.
Long-term debt, less current portion, was $100.7 million as of July 31, compared with $72.5 million at the end of fiscal 2025. Cash and cash equivalents were $2.2 million, compared with $1.5 million at fiscal year-end.
The company said it received $5.4 million in insurance proceeds during the first nine months of fiscal 2026 related to business interruption and casualty loss claims at its packing houses. It also received confirmation Sept. 2 that an additional $2 million will be paid, with the income expected to be recognized in the fourth quarter.
Edwards said Limoneira has identified more than $200 million in real estate development, non-strategic land assets and water rights for potential monetization. In Arizona, the company has ceased citrus farming on 600 acres of lemons and is seeking to replace those operations with lower-water-use crops, which management said could free water for long-term fallowing programs. Edwards said the company remains confident it can reach a water-rights monetization agreement involving its Class 3 Colorado River water rights during fiscal 2026.
Management also expects future proceeds from its Harvest at Limoneira, Limoneira Lewis Community Builders II and East Area II projects. Edwards said the company expects approximately $180 million of total proceeds from those projects over seven fiscal years, including $10 million received in fiscal 2025 and $15 million received in fiscal 2024. He also said home sales in the second phase of Harvest at Limoneira have been running at two to seven homes per week, with the approximately 500-lot third phase expected to go to market in fiscal 2027.
About Limoneira (NASDAQ:LMNR)
Limoneira Company (NASDAQ: LMNR), founded in 1893 and based in Santa Paula, California, is a diversified agribusiness and real estate enterprise. As one of the oldest citrus producers in the United States, Limoneira has built a reputation for cultivating and marketing high-quality citrus fruits, avocados and specialty crops. The company’s vertically integrated model encompasses farming, packing, processing and marketing activities designed to deliver fresh produce to domestic and international markets.
In its agricultural operations, Limoneira specializes in lemons, oranges and avocados, employing modern irrigation, harvesting and packing technologies to maintain consistent product quality and supply.
